Billionaire Michal Strnad’s Czechoslovak Group (CSG) is enjoying booming global demand for arms and ammunition. The holding announced in a short period of time the conclusion of a contract for the purchase of two important foreign manufacturers of ammunition. In total, the group invests tens of billions of crowns.
CSG has grown into an international conglomerate manufacturing in eight countries on three continents. In total, ten thousand people work in the group and connected companies.
“Czechoslovak Group is one of the most active groups in the arms industry in the Czech Republic. Colt CZ Group (Česká zbrojovka) is equally active, which has also made several significant acquisitions in the US and Switzerland in recent years,” commented Adam Páleníček, specialist in mergers and acquisitions from the consulting company KPMG.
CSG has now announced the acquisition of Armi Perazzi, an Italian manufacturer of luxury firearms for hunters and sportsmen.
“Armi Perazzi is a prestigious brand in the field of firearms for sports shooters and elite hunters. At the same time, it is a stable and prosperous company, which is excellently managed by the Perazzi family. Our motivation for the acquisition was not just financial. The purpose of this acquisition is also to strengthen the international prestige and recognition of CSG as a global and innovative industrial group expanding in Europe and the USA,” said Michal Strnad.
Already last year, Strnad bought the leading Italian manufacturer of small caliber ammunition, Fiocchi Munizioni. Recently, CSG announced the conclusion of an agreement with the American company Vista Outdoor to buy its Sporting Products division, which also produces small caliber ammunition of global brands such as Federal and Remington.
Although businessman René Holeček and his group Colt CZ tried to blow Strnad out of this business, the previous owners of Sporting Products eventually preferred Strnad. This transaction alone will cost Strnada around 45 billion crowns. An association of several banks will help with financing there. The group did not disclose the price of the new acquisition in Italy.
“Due to new conflicts and increased geopolitical tensions, the arms industry is on the rise worldwide and the industry can be expected to experience strong demand for the next several units to decades. Many states will have to supplement or strengthen their stocks, because they often neglected this area in the past,” KPMG expert Páleníček described the outlook for the industry.
However, Strnad is also strengthening in sectors outside the arms business. Although the acquisition of the media house Mafra and the chemical company Synthesia from Agrofert did not work out, he did better with other deals.
This March, CSG announced its entry into the segment of production of emission-free and self-driving vehicles providing logistics at airports and ports. This happened in the form of a capital entry into the French company Gaussin.
In the summer, the Czechoslovak Group also honed its skills among startups. It took over the technology company Pocket Virtuality, which focuses on the use of augmented and virtual reality in industry.
The companies from the group took in a total of 25 billion crowns last year. The holding’s operating profit doubled to 5.6 billion crowns. After taking into account the purchased Italian Fiocchi ammunition, even 7.4 billion crowns.
2023-12-15 11:21:16
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