July 22, 2020 / 7:46 AM / 24 days ago

UPDATE 2-Prysmian to buy EHC Global to bolster elevator business

(Adds analyst comment)

MILAN, July 22 (Reuters) - Prysmian has agreed to buy Canadian components manufacturer EHC Global in a C$130 million ($97 million) deal to strengthen its position in cables and devices for elevators, the Italian company said on Wednesday.

The world's largest cablemaker said the proposed acquisition is in line with its strategy to grow and reinforce its value-added operations and would complement its Draka Elevator business.

Fidentiis analyst Renato Gargiulo described the news as positive.

"The deal will strengthen Prysmian's positioning in a niche but high-value-added business with a higher than average level of profitability and positive prospects ahead, additionally leading to some potential synergies with Draka Elevator," he said.

The deal, which is subject to regulatory approval, is expected to be finalised in the fourth quarter.

EHC Global produces escalator handrails, rollers, elevator belts and other components, generating revenue of C$119 million last year, Prysmian said.

Revenue at Draka Elevator, which makes a variety of components for the industry, amounted to more than 250 million euros ($289 million) last year. ($1 = 1.3442 Canadian dollars) ($1 = 0.8665 euros)

Reporting by Giulio Piovaccari Editing by Mark Potter and David Goodman

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