14 July 2009 - MAN Diesel SE and MAN Turbo AG are to work more closely together in future with the aim of forming a merger with each other under corporate law.

By combining the complementary product portfolios, the merged company will strive for further growth, cost optimization and a stronger position in its respective market segments.

"This will allow the MAN Group to combine the engine and power plant expertise of the Diesel Engines business with the compressor and turbine technology of the Turbomachinery business to form a strong Power Engineering unit for the long term," says Håkan Samuelsson, Chairman of the Executive Board of MAN SE.

MAN Diesel is the world's leading provider of large-bore diesel engines for use in ships and power plants, while MAN Turbo specializes in the development and construction of compressors, gas and steam turbines.

By combining these two MAN areas, the merged company will in future be able to offer its customers product packages such as turnkey DCC power plants (Diesel Combined-Cycle), for example, or waste heat recovery systems for marine applications.

"As well as expanding the product range, the integration of the two MAN companies provides further benefits, for instance in terms of costs. Joint global purchasing or joint use of existing production sites are two examples of this," says Georg Pachta-Reyhofen (Dr.-Ing.).

The Chairman of the Executive Board of MAN Diesel SE is to perform the same role in an amalgamated company. The Chairman of the Executive Board of MAN Turbo AG, Klaus Stahlmann, is to become Deputy Chairman of the Executive Board.

He too sees many benefits in the merger: "The cooperation will significantly strengthen our competitive position worldwide. Diverse synergies can be harnessed, e.g. through joint sales activities, improved knowledge transfer and a standardized image for the after-sales services under the brand name MAN | PrimeServ."

The takeover of VW's commercial vehicles activities in Brazil – now MAN Latin America – on January 1, 2009 has provided a significant boost to the commercial vehicles segment within the MAN Group. The amalgamation of MAN Diesel and MAN Turbo will now offer a useful counterbalance to this.

The new combination will have annual revenue of around EUR4bn ($5.6bn) and employ a workforce of approx. 12 000 worldwide. Its headquarters will be in Augsburg.