Sauer-Danfoss supplies the forklift industry with motor axels.

The Danfoss Group and Sauer Holding GmbH have signed an agreement that will see the former become the majority shareholder in Sauer-Danfoss Inc.

Sauer Holding, owned by the Murmann family, will sell 17.5% of the outstanding shares in Sauer-Danfoss to the Danfoss Group. The agreement, subject to closing conditions, includes options to transfer the remaining Murmann shares, about 20% of the outstanding shares, to Danfoss in the next five years.

Sauer-Danfoss says in a statement the agreement evolved from the success of the Sauer Inc-Danfoss Fluid Power merger to form Sauer-Danfoss Inc in 2000. Since 2000, Sauer-Danfoss has experienced a significant jump in sales from USD850 million to USD2 billion. The company attributes its success to the partnership between the two family businesses.

Klaus Murmann, Sauer-Danfoss's chairman emeritus, says the transaction is good for the company.

"As globalisation and consolidation in the industry set new standards and requirements for technological innovation and financial capacity, the parties believe the company will be better prepared for the future by being more solidly tied to a global group like Danfoss."

Jørgen Clausen, Sauer-Danfoss chairman says: "The close relationship and trust that has been built between the Murmann and Clausen families, who are both rooted in the border region of Germany and Denmark, Schleswig-Holstein, has paved the way for this transition of ownership."

Sauer-Danfoss has 9,800 employees worldwide and annual revenue of about USD2.0 billion. The company, with headquarters in Lincolnshire, Illinois and Neumünster, Germany, manufactures hydraulic, electric and electronic systems and components for mobile machinery including forklifts.