Sources inform ''Globes'' that over the last 10 years, Iscar received orders for cutting tools under reciprocal arrangements with foreign companies totaling $192 million. Warren Buffett acquired 80% of Iscar for $4 billion earlier this month.
This is the first time that any details have become available about Iscar’s customers. The list of companies that have bought Iscar’s cutting tools since 1995 include Boeing (NYSE: BA), General Electric (NYSE: GE), German engineering component manufacturer Renk, Oregon Steel Mills (NYSE: OS), International Truck and Engine Corporation, Raytheon Systems and Raytheon Aviation (NYSE: RTN).
Other companies who bought Iscar products include Pratt & Whitney Canada, ABB (NYSE, SAX, DAX: ABB; SWX: ABBZ; LSE: ANN), Caterpillar (NYSE: CAT), Snecma Motors, truck manufacturers DAF and Iveco, Alstom (NYSE, LSE: ALS), General Motors (NYSE: GM), Hoesch-Krupp, Liebherr Group and truck and bus manufacturer MAN.
Iscar’s customer list, which includes many of the world’s leading vehicle and aviation companies, has never been revealed before. The data on reciprocal procurement includes first time orders made under reciprocal civilian procurement commitments between Israeli companies and foreign companies that have won Israeli government tenders. These companies have extensive engagements with Iscar that are not covered by reciprocal procurement arrangements.
Iscar also has reciprocal procurement arrangements with major car manufacturers such as Mercedes with it has reciprocal procurement in excess of $10 million; Peugeot (Paris: PEU), with whom it has reciprocal procurement of more than $15 million; Rover Group; Renault (Paris: RENA), more than $17 million, Volvo (Nasdaq: VOLV; SAX:VOLVA; VOLVB), more than $8 million, Volkswagen (XETRA: VOWG; LSE: VKW), more than $13 million, Porsche and DaimlerChrysler (NYSE: DCX), more than $6 million and Rolls Royce (LSE: RR), more than $32 million.
Rolls Royce and Pratt Whitney also jointly own a 50% stake Iscar’s sister company Blade Technologies, which manufactures aircraft propellers. Reciprocal procurement arrangements expose Israeli manufacturers to leading global companies, whose undertakings are under the framework of the World Trade Organization’s global procurement agreement. In Iscar’s case, global procurement accounted for $192 million, out of estimated annual sales of $1.1 billion.
Published by Globes [online], Israel business news - www.globes.co.il - on May 17, 2006
© Copyright of Globes Publisher Itonut (1983) Ltd. 2006