VEJLE, DENMARK -- Europe's EMS industry was shaken up today as GPV and Enics announced a pending merger to form the continent's second-largest EMS company with more than 7,500 employees and annual revenue of more than DKK 7 billion ($990 million).

The transaction values the combined business at more than DKK 4 billion ($566 million).

Closing is subject to customary approvals, including from anti-trust officials.

Danish industrial conglomerate Schouw & Co., listed on Nasdaq Copenhagen, will hold 80% of the merged entity, while the current owner of Enics, Ahlström Capital will hold 20%. Additionally, as a result of the transaction, Ahlström Capital will receive approximately EUR 60 million ($63.1 million) in cash. The merger will create an international electronics group with more than 7,500 employees .

“This is a combination of two equally strong and very competent companies," said Bo Lybæk, CEO, GPV. "With the merger, we take yet another significant step on our growth journey, In 2018, we successfully acquired the Swiss electronics manufacturer CCS, which had revenue of DKK 1.6 billion. That lifted GPV into the top 10 of EMS companies in Europe, and we have since delivered solid results. Based on our track-record from the integration of CCS, we’re now looking to repeat the success. Together with Enics, we’re creating the second-largest EMS group headquartered in Europe.”

Lybæk will lead the integration of the two businesses into the new combined company.

“Schouw & Co. and Ahlstrom Capital share similar values and both companies’ legacy and long-term strategic outlook provided an excellent climate for negotiation," said Jens Bjerg Sørensen, chairman, GPV. Sørensen will become chairman of the merged company.

“At Schouw & Co., we have a clear strategy of making long-term investments in market-leading companies. With the merger between GPV and Enics, we will now create a leading player that can measure up to even the largest EMS companies, and which within a foreseeable number of years can reach DKK 10 billion in revenue,” Sørensen added.

Following the deal, the merged entity will be Europe's second largest EMS company, behind Zollner.

Enics is among the industrial leaders in design, lean manufacturing, and development of test systems for some of the world’s largest customers, while GPV is a full-service EMS provider specializing in managing high-mix product portfolios, application design and engineering for a strong range of market-leading customers:

“Enics and GPV are a perfect match. I look forward to laying the foundation for this strong European industrial platform. Together, both companies have even stronger capabilities to provide turnkey offerings that will make the combined company a success in the fast-changing EMS market. I’m confident that together we will be driving the sustainable success of our customers and leading the way to change how EMS companies operate in complex ecosystems,” said Elke Eckstein, CEO, Enics.

Enics has seven factories in Europe and Asia across Finland, Sweden, Estonia, Slovakia, China, and Malaysia, while GPV has 12 factories located in Denmark, Switzerland, Germany, Austria, Slovakia, Mexico, Sri Lanka, and Thailand. Enics is focused on electronics manufacturing and test, while GPV also specializes in product application design, in-house mechanics, and cable-harness assemblies. GPV has been particularly successful with its box-build mechatronics products, an area where both Elke Eckstein and Bo Lybæk see great potential going forward, including for Enics’ current customers.

Both Enics and GPV have most of their customers in the industrial segment. Here, GPV recently made a strategic tripartite division of the Instruments and Industries segment, dividing it into Industrials, Measurement and Control and HighTech Consumer. CleanTech, MedTech and Transportation are other of GPV’s important customer segments. Neither Enics nor GPV are exposed to the Automotive and Tripple C (Computer, Communications & Consumer electronics) segments.

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