[WRE | SPOTLIGHT]
Hybrid ropes, those that have fiber on the inside and steel on the outside, is a hot product concept that has occupied some research effort from both Bridon and Bekaert. Both companies plan to combine their findings. “At Bridon, our research is telling us that a hybrid wire rope is going to be a more durable and cost-effective solution than pure fiber ropes for terrestrial applications like high capacity crawler cranes and deep shaft mining,” says Dugan. “Te concept for hybrid ropes has been around for awhile, but no manufacturer has been able to fully pull it off. Both Bridon and Bekaert have prototype hybrid ropes right now. Once we merge, we will put our technologies together.” “Furthermore, Bekaert has experimented with
high-performance polymers, extruded on the mining rope surface, to extend service life. Meanwhile, Bridon has released its NXG technology, which suspends lubrication in the polymers between rope strands, which has dramatically extended rope life, especially on deep water applications, where the undersea pressure can squeeze the lubricant out of the rope,” says Dugan. Bekaert’s advanced cords business has done some impressive work lifting loads like elevators with flat cords instead of oval ropes, which leads to a more efficiently-sized machine room. “We’re eager to get the ropes and cords technologies together to see what exciting innovations that lead to for our customers,” says Dugan.
Competition from Asia sparked the initial interest for a merger. As countries such as China produce great amounts of wire rope, the surplus has driven down the prices on the market. “Tere is, right now, a tremendous amount of wire rope out there on the market, driven by a disconnection between production and demand, especially with some Asian producers. I believe that the wire rope industry has to undergo a major shake out,” says Dugan. “I think it’s healthier if it happens through mergers of good companies. But it will probably also involve some bankruptcies of unhealthy companies.” In the new merger, Bridon (via the OTPP) will
own 33 pct of the company while Bekaert will own 67 pct. “Te new global headquarters will be located in London, on neutral territory. In North America, we will continue to make rope in the U.S. and Canada,” says Dugan. Some of the new exciting plans include the union of each of the company’s complementary skills. For example, Bridon has been successful winning OEM specifications with some mining machine and crane manufacturers and developing a capable distributor network. Ten, according to Dugan, Bekaert has flourished at bringing expertise to the end user. “So, it will be interesting to bring those skill sets together,” Dugan continues. Under the new Bridon Bekaert Ropes Group, there will be 3,000 employees, 10 manufacturing
16 JANUARY-FEBRUARY 2016 WIRE ROPE EXCHANGE
entities across 11 countries, market-focused research and development, and a global sales and service network. According to the press release dated December 7, 2015, issued by both companies, the combined business will account for approximately 600 million Euros ($649.8 million) in sales on an annual basis. It will also add an estimated 350 million Euros to Bekaert’s consolidated annual sales. Tere is a great deal of uncertainty that revolves
around any merger. Many wonder how the new company will fare and others wonder how this merger will affect the rest of the wire rope industry. Nonetheless, Dugan speaks of yet other exciting new plans for the newly-formed company. “Another potential area of synergy is around wire production. Bridon produces most of the wire for the rope it manufactures. Bekaert is a global leader in high-quality wire production. We believe we can gain some insights from Bekaert in helping the Ropes Group develop higher performing wires in a more cost-effective way.” And ultimately, “there will be winners and losers in the next five years in the wire rope industry,” says Dugan. Bruno Humblet, who is presently the CFO of
the Bekaert Group and Executive Vice President of Bekaert’s Latin America operations, was nominated Chief Executive Officer of the Bridon Bekaert Ropes Group. He will assume this role after the merger is completed. Humblet said in Bekaert’s press release dated December 7, 2015, “My first task will be to ensure business continuity throughout the transition phase in anticipation of a successful closing of the business transaction. My team is eager to make the merger a success by serving customers in the ropes and advanced cords markets with excellent products and services, even better than before.” y
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