Volvo Construction Equipment (Volvo CE) has signed a deal with Lantmännen to acquire Swecon while also sell its ownership in China-based SDLG (Shandong Lingong Construction Machinery Co).
Swecon has operations in Sweden, Germany and the Baltics including Entrack. Its scope in these markets includes sales of products and services, rental operations, aftermarket services and support, offices and workshop facilities.
The investment by Volvo CE strengthens its presence in key markets, including its home market of Sweden and Europe’s biggest construction equipment market, Germany.
“At this time of transformation of our industry where our competitiveness is put to the test, directly collaborating with our customers is even more important to be successful. Through the acquisition of Swecon, we believe we can enhance customer satisfaction,” head of Volvo CE Melker Jernberg said.
Volvo CE head of sales Europe Carl Slotte said this acquisition will mean Volvo CE will own and manage the majority of the company’s business in Europe.
“Owning and managing most of our retail operations in Europe provides us a competitive advantage to better meet the rapidly changing demands of our customers and drive new business models, while bringing in valuable competence from Swecon,” he said.
The acquisition is subject to regulatory approval and expected to close in the second half of 2025. For the full year of 2024, Swecon revenues amounted to 10 billion SEK.
“Over the past 25 years, Swecon has evolved into a profitable and successful part of Lantmännen’s business portfolio,” Lantmännen group president and chief executive officer Magnus Kagevik said.
“Volvo CE has expressed a strong wish to get closer to the customer, and their initiative to acquire Swecon is testament to the value that has been built within the business. Volvo CE represents a natural new home for the business, offering strong conditions for continued growth and development.”
Changes in China
Meanwhile, Volvo CE has sold its its entire stake in China-based SDLG to a fund predominantly owned by SDLG minority owner LGG.
The change will see Volvo CE target specific customer segments in China through its premium products and services.
It comes after Volvo CE acquired its majority stake in 2005 which enabled the company to access to the domestic Chinese construction equipment market.
Volvo CE and LGG have recently decided to pursue independent business strategies in this market.
“SDLG has served us well since 2006. However, with increasing competition, and the need to transform to new technologies as well as strengthen interaction with customers, we need to re-focus,” Jernberg said.
“China remains an important market for us, and we aim to capitalise on our opportunities by focusing on sustainable solutions in targeted segments. We also plan to leverage the excellent industrial system in China.”
Volvo CE plants to maintain its focus on the Chinese construction industry through its mining, quarry and aggregates, and heavy infrastructure sectors.
Volvo CE has operated an excavator production facility in Shanghai since 2002. It will strengthen its Jinan Technology Center (JTC) into the extensive Global Technology System of Volvo CE.
Volvo Group will sell its shares in SDLG for 8 billion SEK. The transaction is subject to approvals and is expected to conclude in the second half of 2025.
