Vossloh sells locomotives business to CRRC subsidiary

Vossloh AG has signed a contract to sell its locomotive business unit to CRRC Zhuzhou Locomotive Co. (CRRC ZELC), a subsidiary of the China Railway Rolling Stock Corp.

Vossloh's board has approved the sale. The transaction is still subject to authorities' approval in Europe and China, specifically merger control and foreign trade law clearances as well as standard approvals required from the Chinese authorities. Completion is expected in the next few months, according to a Vossloh press release.

The purchase price is subject to adjustment at the closing date, and is projected to amount to a low single-digit million figure, they said.

Under the agreement, Vossloh is due to receive proceeds from the future sale of certain assets, resulting in expected cash inflow of 10 million euros over the next few years.

"We have found the optimal strategic partner for Vossloh Locomotives in CRRC ZELC, which has the necessary resources to successfully further develop the Locomotives business in the long term," said Vossloh Chief Executive Officer Andreas Busemann.

Vossloh's locomotives business unit is the last one remaining from the original three units of the transportation division that Vossloh has been selling off since the decision was made to focus on rail infrastructure. The company sold its rail vehicles and electrical systems units in 2015 and 2017, respectively. The completed sale of the locomotive unit will conclude the group's restructuring.