Munters Group to acquire ZECO for $72m to dominate Indian air treatment market

Munters Group (MTRS), a global leader in energy-efficient air treatment and climate control solutions, has announced a strategic acquisition of ZECO, an Indian air treatment solutions manufacturer. The acquisition deal is valued at an estimated enterprise value of SEK 790 million ($71.75 million). This move is aimed to capitalize on the rapidly growing Indian market for dehumidification solutions, especially in key industrial segments like Battery, Food processing, and Pharma.

Munters Targets Market-Leading Position with Combined Offering

Munters sees this acquisition as an important step in its growth journey. The combined product offerings of Munters and ZECO positions the company for substantial growth in the Indian dehumidification market. “ZECO is an excellent addition to Munters and constitutes an important step in developing our dehumidification business in India,” said Klas Forsström, President and CEO of Munters Group.

Strong Platform for Growth Across India

ZECO comes with three manufacturing facilities strategically located across north, west, and southern regions of India. The company also boasts an extensive sales network across key regions in India, providing Munters with a strong platform for growth. “The acquisition adds complementary products to our core offer and strengthens our position in several customer segments in the Indian dehumidification market,” mentioned Henrik Teiwik, President of AirTech and Group Vice President, Munters Group.

Impressive Financials and Seamless Integration

ZECO reported impressive net sales of about MSEK 510 for FY 2022/2023, ending on March 31, 2023. The reported EBITA-margin of ZECO is accretive to the Munters Group. The acquisition is expected to be fully financed through existing credit facilities. ZECO Aircon Limited, established in 1989 and headquartered in Gurgaon, caters to a broad customer base across various industries in India.

Closing Conditions and Timeline

The acquisition is subject to customary closing conditions applicable in India, and the deal is expected to be completed before the year-end closing.

In summary, the acquisition of ZECO by Munters Group marks a significant strategic move to solidify its position in the booming Indian dehumidification market. The deal not only enriches Munters’ product offerings but also offers a strong growth platform leveraging ZECO’s extensive reach in India.