To WEG conference call to discuss the acquisition of industrial motors and generators business of Regal Rexnord. We would like to inform you that we are broadcasting this conference call accompanied by the slides on our investor relations website at ri.weg.net. If you require any assistance during the conference call, please request assistance from an operator by typing star zero. Any estimates contained in this document or any forward-looking statements made during this conference call related to future events, business perspectives, the operational and financial projections and goals, and the potential for future growth of WEG, constitute mere beliefs and expectations from the management, based on the information currently available. These involve risks, uncertainties, as they refer to future events, and therefore depend on circumstances that may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operating factors could affect WEG's future performance and could lead to results that differ materially from those expressed in such forward-looking statements. We would like to remind you that this conference call is being conducted in Portuguese with simultaneous translation into English. With us today are Mr. André Luís Rodrigues, Financial Administrative Superintendent Director, André Menegueti Salgueiro, Finance and Investor Relations Director, Alberto Yoshikazu Kuba, Superintendent Director of WEG Industrial, and João Paulo Gualberto da Silva, Superintendent Director of WEG Energia. Mr. André Rodrigues, you may proceed, sir. It's an honor to be here with you for this conference to talk about this important acquisition that we disclose to the market today. I will start the presentation, providing some general information, and then I'll give the floor to Kuba and João Paulo, for them to speak about the business under their responsibility. At the end, I'll return to bring the financial details of the transaction. Finally, I would like to go to page 4 to briefly discuss about the scope of this purchase. We are acquiring, through our indirect subsidiaries abroad, the industrial motors and generators business of Regal Rexnord, which reported revenues of $541.5 million in 2022, with an adjusted EBITDA margin of 9.5%, and includes 10 factories located in 7 countries, in addition to commercial operations in a total of 11 countries, with a workforce of 2,800 employees around the world. Of this revenue, 75% come from industrial engine, which will be included in our industrial electronic equipment business areas. The remaining 25% refers to generators and will be incorporated into our energy generation, transmission, and distribution area. It is also important to mention that the distribution of this revenue, where 55% refers to revenues in the Americas, mostly the USA, Mexico, and Canada, 32% in Asia Pacific, with China and India as the main markets, and 13% in Europe, the Middle East, and Africa. On next slide, we can see the operations and how they are distributed around the world, with factories in the United States, Mexico, Canada, Italy, the Netherlands, China, and India. It is important to highlight that the operations work independently, and the geographic distribution is aligned with our current strategy, which will facilitate the integration of the business into WEG's existing operations, and will help to obtain greater scale and efficiency in reducing costs as we integrate the new operations. Another highlight is that the operations are in good condition and have available capacity in several product lines, which will support our growth in the coming years without the need for significant investments in the short term. Before going into more details about the acquired businesses, on page six, I would like to highlight the main strategic rationales and motivation behind this acquisition. In an important area, while in the business of generators, we are increasing our presence outside Brazil, accelerating our growth and positioning the company among the main players in this market at the global level. This transaction is part of the company's continuous and sustainable growth strategy, which has incorporated acquisitions of new businesses for many years. Always on the lookout for opportunities in the market and aligned with our strategic directions, allows us to grow and offer our customers more complete and efficient solutions. With this acquisition, we seek to boost growth in important markets, reinforcing our presence where we have a good share, and expanding access to markets where we do not operate or where we have low penetration. Finally, we point out that this investment is very much aligned with the company's strong global industry strategy, present in both acquisitions and greenfield projects. ... seeking to make the best of our industrial model also outside Brazil. I now turn the floor over to Kuba, to provide more details about the strategy related to the industrial electric motor business. Good morning, everyone. It's an honor to be here with you, taking part in this call. So talking about industrial motors, we can see major opportunities in the portfolio of products we are acquiring today. This operation has a wide range of products, including motors for general use, where they have a very important market share. Motors for the operation, which are by Italy, motors for maritime use, and with a plant that is located in the Netherlands. As for industrial, we have three very important brands, Marathon, Rotor, and CEMP. These are very, very traditional brands in the industrial area with a lot of value. And we're also addressing some markets which are complementary, where WEG already operates, such as the market of food and beverage, mining, marine, and oil and gas. On slide nine, we have the rationale of our industrial strategy. We understand that we are going to have an interesting growth in the footprint of motors outside Brazil, and integrating with the operation already existing Mexico, China, India, and Europe. With this movement, we are making something interesting progress in the market share in China. This is something where WEG has been investing quite a while, but we do not have high penetration, and this is another step into this Chinese market. We opened a plant, industrial plant last year, with an acquisition that reinforce, considering the fact that we have two other units completing our local portfolio in the Indian market. We are also acquiring an interesting production capacity of special motors, and specifically, we're talking about the plants in the United States and Europe. The two plants that are located in Lebanon and Wausau, are operators, which are very interesting. These are niche, special motors, and we understand that they can help us to achieve more space in the American market. We also have plants in Europe, in Italy, CEMP, and Rotor plant in the Netherlands, and will help us get into very important niches, but whose penetration is a bit more difficult, especially in the area of oil and gas, in the marine segment. They will have a very interesting capacity available. And this available capacity will help us to increase the speed at a much faster pace, in order to meet the needs of those specific markets. Another important point is that those brands that we are acquiring are traditional brands, renowned brands, with a very qualified team as to the technical area and also of market knowledge. On slide 10, we are going to talk about the business strategy. We are going to make headway in a very interesting way in the strategic segments, as I mentioned before. This headway in China, in its internal market, is very important. Some years ago, we had invested in the Chinese market with aim of growing ever more, and this acquisition will bring us a very significant market share gain for our establishment in the local market share. Another point I would like to mention is that the markets that grow the fastest in the world, the Indian market, and WEG and Rexnord had already two local plants. And these two plants, in addition to the plant that we inaugurated, will complete our portfolio of products for the domestic market, and will also help us to accelerate the growth in the local market. And then we have a focus, very interesting, on the strategic positioning of those operations. After COVID, we see a trend of having plants close to the clients, so that's why we are establishing presences where our clients already have a plant. China, India, and also the countries of Europe, where we also have major operations of oil and gas and marine. And it's difficult to provide the services and products from our operations in Brazil. So we have an Italy plant and also a plant in the Netherlands, will help us acquire those niches spaces. It's also important to mention the good positioning of the brand in North America and the Rotor and CEMP brands in Europe. And with this movement, WEG has two plants in the United States, which is important for the domestic advance, especially niche and special motors. Also, there is a law that encourages local production, and it's the IRA that encourages the business and the local markets, and this is gonna be very important in our American market... I turn the floor over to João Paulo, who is responsible for WEG Energia. Over to you. Can you hear me, Kuba? Yes. Yes, we can hear you. Okay. I just wanted to make sure you could hear me. I'm in India. So I'm just checking the connection. Good morning. It's an honor to be here with you to talk about generators. Basically, WEG has a very limited share. In Brazil, we have a leading position, but outside Brazil, generators has, generators have limited share. We have few clients outside Brazil, and we have Marathon, which is an acquisition in the area of generators, and it's a leader in the North American and Canadian market. We have important European competitors, maybe three or four, together with Marathon, that has a very important share in this market, in the world, and other smaller players. WEG has a very limited share in this market, and now we are going to be positioned in a new level, especially in the Chinese and North American market. So Marathon and Marathon are two brands, are well-positioned in the world. And in China, Marathon Generator is the one used as a joint venture with another company. And these are products used for the construction, telecommunications, which is a very important market, oil and gas, food, and beverage. Of course, with this share and the two plants in Mexico and in the United States, we're going to have a very important footprint in this industrial segment. I visited the plant in China, whose idle capacity is very important, so there's a possibility of growth without the need for significant investments. Of course, we're going to have an excellent integration when it comes to supply chain and availability of products. We also see important gains in logistics. As I mentioned in the beginning, this is going to be a game changer as to the generator segment. It, it's going to be a very important player in the world. With a very well-established position in North America and in OEM, which is a segment that it was hard for us to enter, such as Caterpillar and other brands, that WEG was not able to penetrate so far. Of course, our participation in the Asian market for generators was zero, absolutely zero. With this new joint venture, we'll be able now to have a growth strategy, which was strong not only in China, but also across Asia. Now, I turn back the floor to André, for him to discuss the financial items. Thank you, João Paulo. Let's move on to page 16, showing some important numbers from this transaction. As I already mentioned, the portion of the business that we are acquiring posted revenues of $541.5 million in 2022, equivalent to BRL 2.8 billion. If we consider the average exchange rate back in 2022, the operations adjusted EBITDA was $51.6 million, which gives us an EBITDA margin of 9.5% for the period. The enterprise value stood at $400 million and is a cash and debt-free transaction, with a cash payment expected to occur upon the completion of the deal, resulting in an EV/EBITDA multiple of 7.7x, based on 2022 figures. On slide 17, we bring the pro forma numbers of the business combination. As we can see, in 2022, combined revenue would be BRL 32.7 billion, with adjusted EBITDA margin of 18%. These are numbers that represent an important increase in the company's revenue, still delivering a healthy, consolidated margin. Although we understand that part of this, there was an improvement in the margin of the purchased operations may not be sustainable in the short term, an assumption that was considered in our analysis. It's important to highlight that we came into being as an electric motor company back in 1961, and in the first years of existence, we also started manufacturing generators.... We have an efficient and competitive production process. We have mastered this technology, and we know both markets very well, which will be fundamental to ensure efficient integration, seeking to improve the profitability of these operations in the coming years, mainly through actions that I will discuss on the next slide. Firstly, we will provide support to the new operations using the previously consolidated verticalization model of our factory. We also see potential in the integration of WEG supply structure, not only in economies of scale, but also in the access to our global network of qualified suppliers. We will expand our sales channel, increasing access to markets that currently have low penetration, and we will have the opportunity to present a large portfolio of products to a broader customer base. Always seeking to improve back office activities, optimizing the combined administrative structure and operations. Before moving on to the Q&A session, I would like to talk about the next steps in this operation. First, we need to wait for the approval from regulatory entities in the countries where the operations are located, which we hope will happen in the beginning of next year. After these approvals, we will make the payment, thus completing the acquisition process. Once the payment has been made, we'll then begin the process of transition and consolidation of the new business, integrating it into WEG's structure. I end the presentation here. Please, operator, we can proceed to the Q&A session. Excuse me, ladies and gentlemen, we will now begin the Q&A session. To ask a question, please enter star one. To remove the question from the list, type star two. Our first question comes from Lucas Marquiori with BTG Pactual. You may proceed, sir. Hello, everyone. Good morning. Good morning, everyone. Thank you very much for the conference. Congratulations on the event, a very important step for WEG. I have two questions on my side. The first, I don't know if it was Kuba who discussed it, but I would like to understand what's the overlap of clients. I think it was clear on the WEG Energia, and we understand that this is going to unlock, like, entry into some market. So if you could make this comment, reaching the motor segment and what will unlock, which business will be unlocked? We understood that Regal was not growing at the same pace as WEG, so I would like to understand this. So how getting into new channels of sales can also accelerate Regal's business? And the second question is simpler. It's in relation to the plan for the ramp-up of margin. I think Andrea mentioned something about the synergies, but I would like to understand. Andrea, if you could provide some color on the plan. You mentioned that it's not sustainable in the short term, but are you going to bring the margin into WEG's level? And you also mentioned the idleness at plants. So we would like to understand what will be important for the operations to take off so that we can understand it all. Thank you. Thank you, Lucas, for the question. This is Kuba speaking. When we started doing analysis, when we're about to acquire the industrial area of Regal Rexnord, we look at the clients and to in order to understand the level of overlap. To our surprise, we noticed that Regal Rexnord had never been our main competitors in the segments or in the markets we operated. Except for some clients, I would say, compressors client, where Regal Rexnord arrived before us. So there's a lot of new market that we are going to go into with this new acquisition. The markets of maritime application, oil and gas application in Europe, that is used with Rotor and CEMP. We have part of the portfolio there, but considering that we need a lot of local licenses and approvals by the end users, our growth in this market niche is very low. Regal did this movement some years ago by purchasing CEMP and Rotor, and they gained this important market, which is hard to penetrate. So I'm talking about the operations in Europe. In India, for example, it's a market where we have just arrived. We had a line of general use motors. But India, for example, with the acquisition of those operations, the operations that they have there, we are then going to have a complete portfolio of motors. Applications in tunnels, brakes. So the acquisition in India is also expanding our portfolio with complementary products, with more clients than we used to have in the past. This is a different market. Of course, when we talk about distribution network, the network of distribution will include all that Regal Rexnord will offer.... That the competition is very limited. There are not many distributors that work with both brands, so we are not going to see a lot of overlap. When we go to oil and gas, we see that because they are in the United States, so they were focused on domestic products, and if WEG wants to develop those products, it would take many years to get close to OEM to develop a special product. And we would have to have a local plant to meet the lead time required. So I would say that the overlap of clients is very small. And we see this as a great opportunity to make advances using those two lines of products. And we'd like to make clear that we see a lot of value in the three brands that were acquired. Our idea is to continue operating with those brands and also take advantage of the market share they have already acquired. In relation to gain in margin, I think André should answer your question. Thank you for the question, Lucas. When we talk about what's gonna happen to the margins, we have to go back to synergy. The first point is the following: acquisition: we acquire businesses we know well, and therefore, we expect that all the process, after the integration process is completed, we will then be able to capture several synergies, such as the examples I mentioned during my presentation. Of course, they will come from the support of the operations, the mode of use that's already consolidated in our plans, as João Paulo mentioned some of those aspects, and we'll be able to integrate all those synergies. The integration of the structure of supply, which also will lead to gain and scale, and we'll also be able to access the global network of qualified suppliers. Also, we are going to make the best of the channels of sales, increasing the penetration, as described by Kuba and João Paulo in their presentations. We'll have the opportunity to have a broader portfolio, the customer base will also be broader, and we also improve the activities of back office using the combined administrative structure. Our expectation is that during this integration period, the margins of each location will reach the margins, as we currently see, and considering the place where each of those units are operating. Perfect, Andre, Kuba, thank you very much. Have a good day, everyone. Our next question comes from Daniel Gasparete, with Itaú BBA. You may proceed, sir. Good morning, everyone. Thank you for the call. Congratulations on the transaction. It's very symbolic. I have one question. I would like to check my understanding that this operation will have the numbers reflected only after 2024. We are not going to see any effects on the third and Q4s of this year. And I would like to understand the movement in the market as a whole. We have seen Siemens doing some things, divesting some motor segments, ABB also with spin-offs. I would like to understand how you see the dynamics of the market, the movement of the players coming out of the motor segment, and if you see the potential or if you, you see that it's, it's something that happened that will meet the needs of the company, and if it will influence your CapEx plan. Thank you. Daniel, thank you for the question. I will start answering the question, then I turn the floor to João Paulo, and he will answer the second part of your question. Yes, the impact will be felt only in 2024. We also have some processes that is coming into play with some of the areas that we are operating. And so we expect the results to be to be seen only the beginning of next year. Daniel, I'm going to answer the second part of your question, and then I'll turn to João Paulo. Generally speaking, it's important to understand that the core business of WEG has always been electric motors. And we were scaling the business into new markets, and WEG has been investing in the internationalization of our business. So if we observe... Three or four years ago, before the COVID, we reinforced our presence in China with more plants, with investments in robotization automation. We also invested in new plants in India, which is the market that grows the fastest in the world. Last year, we have an assembly line in Turkey. In other words, WEG Motors are going to areas where our shares are limited, considering that we have a very complete portfolio and considering the level of competitiveness that we had along the years, operate in China, India, and Mexico. We understand that we have the main basis, the main pillars to continue growing with a lot of consistency and sustainability along the time. So this is the movement we are going to have, and WEG has industrial motors, alternators, and inverters, and we're going to continue this movement different from our competitors. What is important to understand about the moment we are experiencing, our motor business is living a moment of strong internationalization. This movement in China is for us to be helped in the domestic market, which is a large market. WEG has grown a lot in China in the past few years, but still it's very limited, our presence. So we have an operation using the total possibility to grow and using this Regal Rexnord operation, we will be able to grow our position with the structure that Rexnord already has. We are going to take advantage of the idle capacity, and there are areas we can no longer continue expanding. Kolkata operation, for example, is an operation that may be integrated by WEG, and we can also integrate it into the domestic market. Generally speaking, we want to increase our share in the international market. We also want to increase our share in niche products and take this opportunity and have a pool of factories, which is very interesting, so that we can continue growing in the next few years. This is our rationale behind the motors, industrial motors. Could you mention something about generators, João Paulo? Yes, thank you for the question. At first, I would only like to mention that as to generators slash alternators, which is also referred to generators by the Americans. We are, in other words, talking about three major groups of generators with general application, the small size, general, applications of large-sized applications and, energy generation and large size. And we are more focused on specific applications of small and medium-sized, when we consider the group of generators. So we have some small players in the world. The two that you mentioned do not operate in this type of product that we are discussing. Generators, especially for emergency telecommunications, hospitals, and this type of application, industrial area, food and beverages. These are businesses that have been growing quite a lot, especially telecommunications. Servers for the internet, cloud technology. So this is a market that continues to grow, and it's likely to continue with this upward trend. And also those that use green hydrogen and natural gas. So we see that this acquisition puts us in a position where the approvals are very expensive, complex. And this is something that we have not been seeing. Those companies operating with those kind of products, they, they may be coming out of this market, and there are not many operating in the global market. Espiridião, just to add, in relation to CapEx, I think this was related to the end of your question. André mentioned some of this during his presentation, and we say the CapEx is in good condition and is at the level of capacity that can also withstand the level of growth, at least in the short term. So we do not see any need of short-term investments, and because of this, we should continue investing at the same level, at the same historical level, that WEG has been investing. That percentage of revenue from 3, 4, or 5%, this is not likely to change because of this acquisition. Okay? Okay, excellent. Thank you, everyone. Congratulations again. Our next question comes from Victor Mizusaki with Bradesco BBI. You may proceed, sir. Hello, good morning. Congratulations on the transaction. I have other questions on my side. The first, if you could confirm about your brand strategy that you're, that you're gonna adopt. Do you intend to maintain the brands of Rexnord? And the second question in relation to the size of the transaction, I think this is the largest transaction ever made by WEG, as you mentioned. There's going to be some transformational aspects in the business of WEG. So I can see the strategy of M&A by WEG has changed a little, because the acquisitions were at a smaller size. And I would like you to talk about this transformational aspect.... Thanks, Victor. I'm going to start, and then you can add. Yes, you're right. When I mentioned during my call that we are going to maintain the brand, we're in the markets where they operate. So these are brands that operate different from the methods of operation of WEG, for example. Marathon, which is the brand that we are purchasing, and it's high volume in United States, and they use different brands, a broad range of lines. So food and beverage, oil and gas, automotive, all those lines of products are highly approved, and they represent a very important market of aftermarket or after sales. The American market, for those who don't know it, has a very strong after market and after sales product. Distribution is very important because this area is very important, and Marathon is branded that has been operating in the market for more than 100 years, and it's very important for end users. So the idea is to maintain the brands and the commercial names of the lines associated to those brands. CEMP and Rotor, needless to say, we're talking about two top companies in the niche market. So CEMP, because it's a company focused on explosion-proof motors, will add forces with our factory in Portugal to have complete portfolio of oil and gas in the European market. So we are going to maintain the CEMP brand. Rotor is very important as well, because Rotor works in the marine market in a very complete way, much more complete than WEG. So Rotor can be driver in the commercial area to sell more products of WEG brand. I think this is it. João Paulo, over to you about alternators and inverters. Without a doubt, Marathon is a highly consolidated brand, especially in the United States and North America. Their product line is complete, varied when compared to WEG. So our brand in the United States is now going to be Marathon. And we also intend to take these products to other markets where WEG has capillarity and has presence. So we are going to take those products into other markets. So it's very important to maintain the brand and their line of product. Victor, I'm going to answer the second part of your question. Okay? Now, you asked that if we changed our acquisition profile. First, it's important to mention that acquisition has always been a part of the inorganic strategy of WEG. This has been accompanied our growth process of WEG. It's not the first time we analyze the integration or of the size or even larger than this acquisition. But those that we had in the past did not materialize. The thing is that we did not change our positioning, and we did not change it to work those acquisitions that we considered to be transformational. Of course, this has also an effect to our culture. Now, without a doubt, this is a large acquisition, the largest ever of WEG. But we feel comfortable because we feel ready, considering the businesses included. Motors is an area where we master the operations. As to the financial area, an acquisition that will not affect our LHD. So as I said before, the businesses we acquired is a business where we have global exposure, and WEG is already present in some of those countries. We would also like to say that the inorganic growth strategy is based on two pillars: new markets and new technologies. This technology will provide us with access to new markets, as mentioned by João Victor during the presentation. Okay, wonderful. Thank you. Our next question comes from Marcelo. You may proceed, sir. What would be the idle capacity of those plants per country or per category, so that we can understand the order of magnitude, 10% or 20%, maybe? The second part, when we look at taxes, or is there any laws, anything that could help reduce the effective, and also in the short term, anything related to this? Thank you. Marcelo, thank you for the question. This is Kuba. In the visits we made, we saw that most of the operations are operating at 50% of their production capacity. We work, WEG continuously work in all our operations. And so theoretically, we would be able to double the volume produced using the structure which is already there. Another important point, now, answering your question and introducing the new topic, we have operations which are important that involved large CapEx, such as our operation in Mexico. So our operations can provide components to the structures we are acquiring. So as mentioned, we have a very important synergy behind this acquisition, and the design of the operations that we are acquiring has a level of outsourcing activities of components, which is very important. And WEG has a verticalization segment, which is very important. So we can have a mix to improve the capacity of our operations and also help their operations, should we be able to operate in their market in the future. As to the alternators, any comment? No, Kuba. The same comments you made are applicable to alternators. And the supply chain and the verticalization of WEG, we have enough capacity to the idle capacity to use. In China, we are completing some initiatives, and we will be able to supply components to the operations in China as well. Okay, that's it. Could you answer the next question, André? Yes, of course. Marco, I would like to say that most of the operations come from the fiscal benefit. We analyzed all the process. We didn't find anything that could give us an advantage or could help us reduce as to tax. So in the short run, at least, we do not see any changes in relation to tax. Okay, thank you. Our next question comes from André Mazini, Citibank. You may proceed, sir. Hello, everyone. Thank you for the call. My question is related to antitrust authorities. You're working in—you're gonna be working in seven different countries. So is... Are those authorities considered country by country? Have you studied all of them, or is there any concentration in terms of antitrust authorities, more focused on some products? And the other is the mix of employees. Every company has important people and key persons, and sometimes there are clauses of the companies. So, this is more related to synergy of the workforce. And what about those people who are coming from those new acquisitions? André, this is an. The antitrust process starts just now, after the execution of the document, and this is done country by country. It's a process that is gonna take place at each country, individually, and all our analysis, considering those units we are acquiring, we didn't find any complex situation for those approvals. So those approvals are going to depend on the challenges coming from the each country. And we are getting ready so that we can have all the necessary information, so that we can complete the process in the Q1 of 2024. And what about the employees, the key people, André? Oh, yes. In the visits that we made, we visited the structures, and we noticed that the team is very committed, senior management, middle management, they have been in the company for a long time, and the culture is very similar to ours. So we believe that, and wonderful people are coming into our structure, and this is something very important to mention. The discussion that we had, since the beginning, we started negotiating with Regal Rexnord, because we wanted to align the structures, and we were very happy with what we saw in terms of technical quality, technical quality management. Yes, and there's a clause according to which we're paying a bonus for the key people to be maintained in the company, which is natural in this kind of acquisition. Considering how everything was well designed, all those employees are going to join our team, and we believe that we are going to have a single team with more than 2,800 people. We are very happy with what we've seen so far, and the synergy is likely to be very successful. Okay, perfect. Thank you and congratulations. Our next question comes from Rogério Araújo, Bank of America. You may proceed, sir. Good morning, sirs. Congratulations on the transaction. I have one question in relation to market share. Can you give us an idea of what's the market share at the global level or country per country? What would be WEG's share, and what will it be before and after the acquisition? And the other question is in relation to the margin, a follow-up question. How much of those 9.5% of EBITDA margin of last year is not sustainable as you see it? And you also mentioned an expectation of margin catch-up at the same level that you see in other countries. This weighted average in the countries where they're operating, is the margin lower than the average margin of WEG or not necessarily? Thank you. Hello, Rogério. Thank you for the questions. So let's talk about market share. At present, WEG has an important share in the market of low voltage motors, as you already know. And in our last WEG day, we said that this acquisition positions us as the second largest manufacturer in the world. As to generated, this was something very well concentrated in the Brazilian market, and this acquisition increases our presence outside Brazil, placing us as a relevant player and a global player, especially in China. In relation to the margins, the first question was if, the margins are sustainable. I think Regal Rexnord was very cautious in the process, and high-level advisors were hired, providing detailed explanations about the behavior of the margin. So in the first analysis of what had been studied for us to make the decision, that the margins are supportable or sustainable along the time. Of course, there are market exposures in the market, and we may have fluctuations along the period. What can we say today about this integration process, which is likely to happen after we have all the approvals of the antitrust authorities, which will take place the beginning of next year? So we are going to work so that we can have the margins, which are closer to, the operations that we have in each of the locations. Obviously, the margin of a country such as Mexico has to be higher than that of the United States, and so on and so forth. But this is WEG's expectation, and thanks to the list of the synergies that I described, we have the expectation to bring them close to our current margins, and, we will have better gains of scale by means of our verticalization strategy. So we are likely to have more gains along the process. Thank you, Andre. Thank you. Our next question from Alberto Valerio, UBS. You may proceed, sir. Thank you for taking my question. Congratulations, WEG team, Kuba, André, João Paulo. A more strategic question looking into the future. WEG usually has two types of expansion: organic, by means of modules, such as we saw in Mexico and China, and also the inorganic growth, which relates to purchase market share. So what can we expect in the next 12 months? So WEG has just purchased the acquisition of some land in Mexico, and it has just purchased Regal Rexnord. So what can we expect in terms of expansion from this acquisition? Thank you, and congratulations again. Hello, Alberto. Thank you for the question. I believe that when we talk acquisition processes in the company, something that we always mention is that we analyze both opportunities. Each business opportunity has its own characteristics, and there's a search for opportunities. They happen depending on if we see, find a company inside, a company with the same technology, and we always try to make agreements with the other party. This is something that is not likely to change. We do not have an objective to having a numbers, specific number of acquisitions per year. In the past, we had the purpose of reaching BRL 2 billion, up to 2020 and, and we wanted to be more aggressive in the acquisitions. We did not follow that way back then, because our commitment is to maintain the returns and operating margins at healthy levels. We do not make an acquisition only looking at the top line and growth of revenues. We do not have any expectation in this regard. We do not have an objective to making new acquisitions this year. Maybe if an opportunity comes up and will be aligned with our strategy growth, we'll consider. When you mentioned the land in Mexico, that is completely aligned with our long-term strategy. Everything we do at the company is looking to the future, and in that specific case, we saw that that was an excellent opportunity. Yes, we have a foundry business beside that land mentioned and other investments that are being made. So in the future, we are considering having new greenfield projects in order to strengthen our positioning, so that we can use up the opportunities of growth in the market. So we were—we do not have in mind to make short-term investments when we purchase the land, so we are going to try to maintain our CapEx related project at the level of 3%-5% of our revenue. Now, talking about industrial market, industrial motors. Talking about the addressable market, what happened, Alberto, is we consider the speed that we can tackle or go into those markets. WEG has plants practically in all those main countries where we are acquiring plants of Regal Rexnord. We already have operations there. So the thing is that our level of occupation is reaching its limit, and the new plants give us possibilities to grow, and above all, it allows us to go into niche markets. It's not just installing a plant and approve brands and in new areas such as oil and gas and maritime segments, and that takes a long time because we need to build trust with those clients. So this takes a lot of time. So the rationale behind this acquisition is to accelerate the penetration of WEG's in those markets, which are harder to penetrate. We need to carry the research on the addressable markets of industrial motors, and which, according to the revenue, to the investigation, reaches more than $14 billion. And we are giving a very important step, such as India and China, but we still have a lot of room to grow and continue working in the years to come. Okay? Hope you're perfect. Thank you. Our next question comes from Gabriel Rezende with Itaú BBA. You may proceed, sir. Hello, everyone. Good morning. Thank you very much for answering our questions. We would like to have a quick follow-up of a comment during the call related to the occupation of the plants of Rotor. If I understood right, we are talking about a 50% occupation on average. So we would like to understand what explains this idle capacity of 50%. Did Rotor made recent acquisition, and is it a moment of the cycle and the occupation is likely to grow? So we would like to understand this idle capacity at present. It's hard to say what happened, but we have been noticing the following: Regal Rexnord was intending to focus on new businesses, and they did not give a lot of focus on industrial motors. Those are profitable operations, but the growth driver was not so high. When we establish a plant, we want the areas to work in two shifts, and since Rexnord focused on assemblers and we -- this allows more flexibility. I think this may be the point. If you look at the market share in the past few years, they were having more -- they're having difficulty to advance in their market share. So we see this as a big opportunity, especially considering the quality of the brand and the people who are in the team. And we saw this as a big opportunity and take advantage of those synergy and scale up. Kuba, if I could add. In China, as for generators, they had a very small operation. The physical space was very limited. And the production layout had lots of complexities. And they moved to a much larger plant. As they moved recently, a lot of idle space is still available at the plant, and they only work in one shift. Something recent also happened in Mexico, in the new plant. And that will allow them to increase their capacity of production in that location. Okay, excellent. Thank you, Kuba and João Paulo, and congratulations. Our next question comes from André Ferreira with Bradesco BBI. You may proceed, sir. Hello, good morning. Thank you very much for taking my follow-up question from Bradesco. You mentioned some of this during the call. Now, thinking about the verticalization of WEG and the new capacity that Rexnord will bring, will you need to increase your foundry capacity in Mexico, for example? Hello, Andre. No. In fact, this is a major opportunity. The CapEx investment in a foundry is very high. So combining our operation in Mexico, we occupy the idle capacity. This is very good because we will be able to operate the second shift. And the operations that we're acquiring in Mexico and the United States can be aligned with the foundry operations that we already have. As for components, we always make investments in components so that we can have a very well-balanced plan. As we notice that it will make sense to increase the verticalization and accelerate the business, we are going to observe the supply investments and the suppliers. The main gain of all this transaction is not to have to invest in a new foundry. We are going to use the idle capacity that we have available today in Mexico, so that we can supply the components to the operations, both in the United States and Mexico. When we talk about components, it's something simple. As we integrate, we see the idle capacity, we see the opportunities of establishing the second and third shifts at the plant, and we see this as a major opportunity to balance our business, including the plants, and bring in this verticalization strategy to all operations. That's it. Okay, thank you. We close the Q&A session. I would like to give the floor back to Mr. André Rodrigues for his final remarks. Mr. Rodrigues, you can proceed. Once again, thank you very much for attending the call and for the questions asked. I would like to say that our investor relations team is always available for any further clarifications you may need. Thank you. WEG's conference call is now closed. We would like to thank you for your participation, and have a nice afternoon.