Austrian engineering group Andritz has agreed to buy Xerium Technologies (Youngsville, N.C., USA), this week, a prominent of paper industry products, in a $833 million cash deal that helps diversify its offerings.The move will enable Andritz, which produces machinery for hydro power, metal pressing, and pulp and paper production, to further strengthen its position in the paper industry, which Xerium supplies with parts and services.

"The acquisition fits squarely with our long-term strategy to execute complementary acquisitions and to grow our after market business with its stable source of revenue and earnings," said Andritz’s CEO Wolfgang Leitner.

James Mitarotonda, chairman and CEO of Barington Capital Group, a New York-based activist investor who owns about 5.05% of Xerium, said it was pleased with the deal, which helps "unlock the company’s tremendous value potential for shareholders."

Barington, which disclosed its stake in April, had previously urged the company to explore a sale.

The Austrian group will acquire Xerium for $13.50 per share in cash, in a transaction valued at approximately $833 million, including net financial liabilities of around $590 million, Andritz said.

Xerium’s board of directors has already approved the deal, as well as 20% of its shareholders.

Xerium makes and supplies machine clothing and roll covers for paper, tissue, and board machines, including maintenance, and after market services. It provides a sophisticated digital software tool to optimize pressing performance by means of sensors integrated into the roll covers.

The company operates 28 manufacturing facilities in 13 countries including one site in Austria, according to its website. It reported an operating income of $54.8 million on sales of $481 million in 2017.

"Financing has not been announced but as half the net cash includes customer pre-payments, we would assume some additional debt financing," said Jefferies analysts in a note to clients