Tognum Group acquires Katolight, a manufacturer of gensets in Mankato, Minnesota,USA

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Tognum CEO Volker Heuer: "This acquisition opens up strategic market prospects for our business in North America and gives us optimal access to end-customers." -- Excellent supplement of Tognum's Decentralized Power Generation business unit in the important North American market. --Further milestone along the growth path of Tognum.

Tognum GmbH, headquartered in Friedrichshafen, Germany, today announced the acquisition of Katolight Corp., a U.S. manufacturer of generator sets. Katolight is based in Mankato, Minnesota, USA, and produces diesel and gas-powered engine generator sets for industrial and agricultural applications as well as for emergency power supply, covering a power range of 15 to 3,250 kilowatts. With around 340 employees, Katolight posted sales revenues of approximately $135 million (approx. €100 million) in 2006/07 (fiscal year ending March 31, 2007). The parties to the transaction have agreed not to disclose any details of the price paid.

"With the acquisition of Katolight, we have passed another milestone on our track to become a globally leading provider of decentralized power generators," stated Volker Heuer, CEO of Tognum. "Katolight is a perfect element in our growth strategy, because it is a well-positioned brand and an excellent supplement to our product range in the important and further growing North American market. Another crucial factor is that Katolight gives us direct access to end-customers."

Business relations have already existed between Tognum and Katolight for many years. For example, some of Katolight's generator sets are based on diesel engines from the core Tognum company, MTU Friedrichshafen GmbH. Its subsidiary, MTU Detroit Diesel Inc. (in Detroit, Michigan, USA), supplied more than 170 of its Series 60, Series 2000 and Series 4000 engines to Katolight last year.

"We know the company very well and know that we have acquired a platform with great potential for the distribution of power generators, primarily based on our own engines," explained Heuer. MTU Detroit Diesel, while now supplying Katolight with engines, will maintain its role as engine supplier to other customers in North America.

Katolight, a family owned business founded in 1952, was most recently owned by Kay R. Jacobson and managed for the past 21 years by her husband, Lyle G. Jacobson. "The main reason for the sale to Tognum was the fact that Katolight will be in the hands of a long-standing and reliable business associate", said Lyle G. Jacobson. "It is also important to us that Tognum is taking over all of our workforce and will continue to operate under the Katolight name in Mankato, Minnesota."

The new company in the Tognum Group will play a key role in the Systems and Components division offering standardized power generators. Katolight will be operated as a brand for generator sets based on diesel engines. It complements the well-known Tognum brands MDE and CFC Solutions, which specialize in gas-engine generators and fuel-cell generators, respectively.

"We are excellently positioned in the marketplace with this trio of proven and future-oriented products for the constantly growing demand for local power generation," stated Tognum Executive Vice President Christof von Branconi, who is responsible for the Systems and Components division. "It is becoming increasingly important to have electrical energy available quickly and reliably wherever it is needed," pointed out Branconi. "This is particularly apparent in the United States, where hurricanes or heavy snowfalls often disrupt the regular power supply."

With immediate effect, Katolight will be managed by Armin Groeber as CEO, who until now has been responsible for the entire assembly of engines and main components at the core Tognum company MTU Friedrichshafen. Groeber already has over two years' of business experience in the United States: he was Head of Operations for the North American region from 2002 until 2004. "I'm looking forward to returning to the United States," said Groeber. "Taking full entrepreneurial responsibility for Katolight with its highly motivated team is a great opportunity to further develop the company and strengthen its market position."

Tognum
With its business and trade names MTU, MTU Detroit Diesel, Katolight, MDE, CFC Solutions, L'Orange and Rotorion, Tognum GmbH is a worldwide leading supplier of diesel engines and complete drive systems for ships, heavy land and rail vehicles, and industrial applications for decentralized power generation plants. The company also distributes Mercedes-Benz industrial engines. The range of products, with diesel engines from 20 - 9,100 kW (27 - 12,200 hp) power, gas engines, gas turbines and fuel cells, is one of the most modern and comprehensive in the industry. Tognum develops and produces customized electronic systems for the control and monitoring of the engines and drive systems. The company employs more than 7,500 staff worldwide and achieved sales of more than € 2.5bn in 2006. With 16 subsidiaries, more than 130 sales partners and 1,100 authorized dealers, Tognum's sales and service structure is established on a global scale.

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Richard Voytowich

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