Clipsal to join Schneider Electric in global industry move

In a move which is certain to change the face of the electrical industry, not only in Australia but worldwide, the shareholders of Gerard Industries Pty Ltd have decided to sell its core electrical business to Schneider Electric.

Those behind the decision hope that the move to join with the world's largest power and control specialist will enhance the Clipsal brand name in the global marketplace.

The approximately AUD$750 million deal was unveiled recently in a joint announcement by Gerard Industries Chairman and Managing Director, Robert Gerard AO and Schneider Electric Pacific Zone Managing Director, Laurent Vernerey.

The purchase by Schneider includes Clipsal's core business including the Clipsal brand name, worldwide intellectual property, together with operations in New Zealand, South Africa and India and a lease of the Gerard Group's manufacturing facilities at Bowden, Wingfield, Strathalbyn, Nuriootpa and Murray Bridge in South Australia.

Schneider has also announced its intention to form a 50/50 joint venture with Singapore-based Clipsal Industries (Holdings) Limited which holds a long term exclusive right to the Clipsal trademark for Asia and has been a co-shareholder in Gerard Industries since 1993.

Clipsal Industries Holdings will contribute to the joint venture its core electrical accessory manufacturing facilities and joint ventures including those in China, Hong Kong, Singapore, Malaysia, Indonesia, Vietnam and the Middle East while Schneider will contribute its PDL Malaysian business and SEDD subsidiary in China.

The completion of both transactions is subject to various conditions including regulatory approvals and Clipsal Industries shareholders' approval. This process is expected to take several months to be completed.

The Clipsal business in Australia will continue to be led by current General Manager, Simon Gerard and his management team based in Adelaide.

"Our management team will stay in place," says Simon, "but staff will now be exposed to international opportunities not previously available to them.

"Our long term goals have always been to ensure the growth and international success of Clipsal as an Australian brand and, as a key strategic asset of Schneider Electric, the Clipsal brand will continue to prosper in Australia and throughout the Asia Pacific region."

Robert Gerard adds that for Clipsal's customers and employees it would be "business as usual...only better."

In a statement outlining the up-side for Schneider, which employs 75,000 people and has a presence in 130 countries, Mr Vernerey made clear his admiration for the Clipsal brand which has been built up to be a household name.

"The Clipsal name is synonymous with leadership and innovation, while the servicing of the brand is the best we have seen," he said. "The Clipsal brand fulfils an important niche in our portfolio of brands and we look forward to working with the Clipsal team to develop the brand even further."

Once the transaction is completed, Directors Robert and John Gerard will head up the numerous non-electrical businesses such as Custom Press, Tapestry Wines and various rural interests under the Gerard Corporation banner.