CAF enters into agreement to acquire Polish bus manufacturer Solaris

CAF has decided to take an important step within its Strategic Plan, on the road to European leadership in sustainable urban mobility systems. Together with Solaris, CAF will broaden its already extensive range of products enabling it to meet the current and future needs in urban transportation, particularly in electric mobility and multimodal door-to-door solutions. Moreover, by integrating with the Polish company Solaris, the CAF Group will become one of the market leaders in the bus segment.

“CAF’s investment in Solaris confirms our commitment to the vision of profitable growth and opens new strategic markets to CAF,” said Andre?s Arizkorreta, President and Chief Executive Officer of CAF. “Together with Solaris, we will create a leader in urban mobility solutions beyond rolling stock, particularly in the e-mobility segment. We want to continue using and to develop Solaris’ valuable brand and to keep its Polish character. The combination of both companies’ know-how in production, design, technology and services, together with the track record of Solaris in bus product innovation will allow us to better serve our clients while creating shareholder value.”

“By selecting CAF as an investor for Solaris, we ensure a promising future for the brand, its clients and its employees.” said Solange Olszewska, President and CEO of Solaris Bus & Coach. “I strongly believe that CAF has the right vision for the company and will be able to develop Solaris’ potential on a global scale. I am confident that this agreement is fully in line with everything we have achieved since the company was founded 22 years ago and elevates Solaris to a higher level of development path”” – Mrs. Olszewska added

Solaris, established in 1996, is a global supplier of conventional and electric buses with presence in over 700 cities in 32 countries. With a 2017 turnover of close to €450 million, it has production plants in Poland in the cities of Bolechowo and Sroda, and a workforce of more than 2,300 people.

The main markets where Solaris operates are Poland, Germany, Italy, Scandinavia and the Baltics. In 2017, the company delivered 1,397 buses, including conventional models (diesel and CNG) and a growing number of e-mobility vehicles, where it offers the widest available range of solutions, e.g. hybrid buses, trolleybuses, full-battery and hydrogen fuel cell powered public transport vehicles. Additionally, the company offers related services, such as maintenance and spare parts.

In 2017, Solaris Urbino electric bus was awarded the prestigious “Bus of The Year” title. July 3rd, 2018

The transaction will position CAF Group as one of the leaders in the urban segment in Europe. It will also open new opportunities for CAF’s urban railway business in Central and Eastern Europe and strengthen its services, electric traction equipment and transport systems design businesses, while providing an opportunity to enter and grow in new mobility-related areas.

In the bus segment, and complementary to the work undertaken in recent years by CAF’s Vectia subsidiary regarding development of urban and hybrid electric transport solutions, the agreement with Solaris will allow enlarged CAF Group to offer the widest and most complete range of products in the high-growth market, especially in the e-mobility segment.

CAF's decision, in line with its 2017-2020 Strategic Plan, will increase its technological capability to offer integrated transport solutions to an even wider portfolio of clients.

It should also be noted that the business complementarity of Solaris and CAF Group, with a large number of clients worldwide, will enable potentially significant synergies, such as ability to provide a more complete offer to customers, an increased technological and financial strength to successfully participate in large tenders, as well as economies of scale in purchases and technological development (R&D).

The Enterprise Value of Solaris is estimated to be slightly above €300 million, with the final amount to be determined at closing of the transaction based on the relevant adjustments. This value results in a PER ratio for Solaris based on 2018 estimates below CAF’s 2017 ratio.

The transaction, which involves the acquisition of all of Solaris’ shares, will be funded mainly by additional CAF debt, and remains subject to customary closing conditions, including the approval of the Polish and German Anti-Trust Authorities, expected by September 2018.

About CAF

CAF is a multinational group with over 100 years of experience in the supply of comprehensive transit solutions positioned at the forefront of technology for high value added sustainable mobility. The company is a leader of the railway industry offering one of the most comprehensive and flexible arrays of products in railway related markets, such as rolling stock, components, infrastructure, signalling and services (maintenance, refurbishing and financial services). CAF's committed personnel and the cooperation with our business partners enable us to enhance customer satisfaction and create value for our shareholders.