The IPOX® Watch: Renk Group AG
COMPANY DESCRIPTION
Renk Group AG, headquartered in Augsburg, Germany, is a leading global provider of propulsion and drivetrain technology. The firm manufactures gearboxes, engines, bearings, and couplings for marine and military applications. The firm started off in 1873 as a manufacturer of gears, and first went public in 1923 after it was incorporated into German engineering group MAN. As part of MAN, Renk shifted into automotive and tank gearboxes. After Volkswagen's majority takeover of MAN in 2011, Renk AG became a member of the Volkswagen Group, from which it was demerged at the end of 2018. In 2020, the firm was sold to Rebecca BidCo AG, a portfolio company of private equity firm Triton and delisted from the Frankfurt Exchange in February 2021.
BUSINESS MODEL
Renk's business focuses on the design, engineering, production, testing and servicing of drivetrain technologies in defense, energy and industrial sectors. Customers include the US Army as well as forces of most European countries (e.g. Germany, UK, France), defense contractors such as Saab, BAE Systems, Thales and KNDS, who uses Renk's transmission in the Leopard 2 main battle tank. Energy sector customers include General Electric, Siemens Energy, Exxon Mobil, among others. In order to bolster its presence on the North American market, Renk recently purchased the combat propulsion systems unit from L3Harris Technologies (LHX US) in 2021 for $400 million.
IPO HISTORY
On 02/07/2023, Renk Group AG (Ticker: R3NK GR) returned to Frankfurt Stock Exchange led by Citi, Commerzbank, Deutsche Bank, Goldman Sachs, JP Morgan, Landesbank Baden Württemberg, and Unicredit. The engineering firm offered 29.68 million shares at €15.00 per share. Renk was valued at €1.5 billion at offer. The shares opened at €17.79 and closed the first day higher at €22.90 (+48.67%).
Renk Group AG was included in the IPOX® 100 Europe Index (ETF: FPXE US, FPXE LN, EFPX IM) through an extraordinary corporate action on 02/12/2024, replacing UK sports retailer JD Sports Fashion.
The firm has gained +22.12% since addition to the index and currently weighs about 0.54% in the portfolio.
