Kone Oyj is engaged in advanced negotiations to acquire TK Elevator, according to people familiar with the matter cited by news reports. The Finnish company is said to be making progress in talks with TK Elevator’s private equity owners, Advent International and Cinven, as both sides pursue a potential transaction.
Sources indicate Kone hopes to reach an agreement by the end of the month. Those same sources caution that, while discussions are progressing, there is no certainty a deal will be completed.
Advent and Cinven have been seeking a valuation of up to €25 billion, including debt, for TK Elevator in any takeover scenario. That price guidance reflects the backers’ view of the business’s value if sold, according to the reporting.
At the same time, Advent and Cinven continue to consider other strategic alternatives for the company. Those alternatives include the possibility of listing TK Elevator on public markets. The private equity owners are therefore pursuing multiple paths rather than committing solely to a sale to Kone, the sources said.
The conversations between Kone and the owners of TK Elevator, and the backers’ parallel review of options, mean that while negotiations have advanced, the outcome remains uncertain. Parties involved are reportedly working toward an agreement by the end of the month, but no definitive deal has been announced.
Context summary
The reported discussions center on a potential acquisition that, if completed on the terms reported, would be among the larger European takeover attempts this year. The proposed valuation under consideration by TK Elevator’s backers, up to €25 billion including debt, has been a key figure cited in reports about the talks. Advent and Cinven are keeping alternative options open, including a stock market listing.
Key points
- Kone Oyj is in advanced talks to acquire TK Elevator from private equity owners Advent and Cinven.
- Advent and Cinven have sought a valuation of up to €25 billion, including debt, for TK Elevator.
- Advent and Cinven are also exploring alternatives such as an initial public offering; no deal is guaranteed.
Sectors affected
- Elevator and escalator manufacturing and services
- Private equity and mergers and acquisitions activity
- Capital markets if a listing is pursued
Risks and uncertainties
- Negotiations may fail - Despite being described as advanced, talks between Kone and TK Elevator’s owners could end without a transaction.
- Valuation gap - Advent and Cinven’s desire for a valuation up to €25 billion including debt could complicate reaching an agreed price.
- Parallel options - The owners’ exploration of other routes, including a stock market listing, means timing and certainty of any sale remain unclear.
Note: The information in this report is based on accounts from people familiar with the matter. No definitive transaction has been announced.