NASDAQ OMX Copenhagen
Nikolaj Plads 6
DK-1007 Copenhagen K
26 March 2009
Release No. 7
NKT Cables expands Chinese production of high voltage cables
NKT Cables has today signed a conditional agreement with a Chinese partner
concerning sales and production of high voltage cables in China. The agreement
provides for the establishment during the months ahead of a joint venture
company owned 51% by NKT Cables and 49% by the Chinese partner.
Scope of agreement
Under the agreement the joint venture company will acquire an existing high
voltage cable factory. The factory consists of a plant that hitherto has been
operated by a separate company belonging to the Chinese partner. The factory is
newly established and entered service relatively recently, and the acquisition
will therefore not include current activities or commitments. The operation of
the cable factory by the joint venture company is not expected to commence
until 4th quarter of 2009.
The establishment of the joint venture company and the transfer of the cable
factory are conditional upon successive fulfilment of various compliance issues
over the months ahead, including regulatory approvals. The final decision on
investment is further conditional upon NKT Cables' completion of due diligence
enquiries.
Financial aspects
The investment by NKT Cables with regard to establishment of the joint venture
company and transfer of the cable factory is expected to amount to a cash sum
of around 80 mDKK that can be contained in the Group's existing capital
resources.
The investment will not affect NKT's earnings forecasts for 2009 announced in
the NKT 2008 Annual Report issued on 5 March 2009.
Perspectives
We view this cooperation as a unique and attractive way of creating a foothold
for NKT Cables in the expanding Chinese market for high voltage cables (> 110
kV).
The investment must also be viewed in context with NKT Cables' existing Chinese
sales and production of medium voltage cables and catenary wires for high speed
trains.
A stock market announcement will be issued, when establishment of the joint
venture company and transfer of the cable factory are finally completed.
Please address any questions concerning the contents of this announcement to
the undersigned on telephone no. +45 4348 2000.
Yours faithfully
NKT Holding A/S
Thomas Hofman-Bang
President and CEO of NKT Holding A/S
