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People's Daily Online>>China Business

Kone on way up as it lifts stake in venture

By Wang Wen (China Daily)

15:07, February 22, 2012

BEIJING - Kone Oyj, a leading global elevator and escalator maker, has acquired the controlling interest in its Chinese joint venture, the company said on Tuesday.

Finland-based Kone paid 950 million yuan ($150.86 million) for a further 40 percent stake in GiantKone Elevator Co Ltd, which was established with Zhejiang Giant Holding Co Ltd in 2005, and increased Kone's ownership to 80 percent.

The transaction was completed in December, but it still requires final approval by the Chinese authorities.

"GiantKone will continue doing business as a separate entity utilizing the GiantKone brand," said Matti Alahuhta, president of Kone Corp.

GiantKone, based in Huzhou of East China's Zhejiang province, employs more than 2,000 people. Its revenue was more than 1.5 billion yuan in 2011.

Giant Holding still has a 20 percent stake in GiantKone, which Kone won't purchase, Alahuhta said.

"The current 80-20 partnership is the best solution for both of us," he said.

The acquisition has given Kone a leading position in the elevator industry in China, since the combined market share of Kone and GiantKone was about 14 percent in 2010.

The acquisition will also let Kone extend its reach to medium-sized cities in the central and western parts of China, which offer the fastest-growing markets, Alahuhta said. GiantKone is also pleased with the transaction.

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