NAGOYA -- Major Japanese machine tool maker DMG Mori Seiki Co. said Thursday it will carry out a takeover bid to acquire its German partner.
The Japanese company currently owns 24.3% of DMG Mori Seiki AG, formerly called Gildemeister. The Japanese maker said it aims to increase its stake to anywhere from over 50% to 100%.
It estimates the acquisition will cost between 556 million euros and 1.64 billion euros ($643 million to $1.9 billion). DMG Mori Seiki Co. will conduct the takeover bid from Feb. 11 through March 11, paying 27.5 euros per share.
DMG Mori Seiki AG is Europe's largest machine tool maker. In 2009, the two companies formed a capital partnership and have since been increasing their cross-shareholdings and collaboration. The German company is an equity-method affiliate of DMG Mori Seiki Co.
The companies integrated their corporate names under DMG Mori Seiki in autumn 2013, and the Japanese manufacturer has unveiled plans to integrate their management by around 2020.
Speaking to reporters Thursday morning, DMG Mori Seiki Co. President Masahiko Mori said, "This is a friendly takeover bid, and I am confident we can secure a more than 50% stake."
Asked why he is making the move, Mori said he has been keen to integrate the companies through an equity acquisition as early as possible. "We aimed to swap each other's stocks in the spirit of equal partnership, but we didn't see a light at the end of the tunnel [due to legal restrictions and other factors]," he said.