RSS FeedM&M Acquires 68% In German Forging Firm Jeco Holding
Fri, 09/29/2006 - 08:22 — Sahad P VAuto major Mahindra & Mahindra has made another big ticket acquisition overseas. M&M has acquired 68 per cent stake in a German forging firm Jeco Holding AG at an enterprise value of Rs 830 crore. The acquisition was made through M&M's Mauritius subsidiary Systech. Jeco is one of the top five forging firms in Germany and its revenues last year stood at 180 million euros.
With this acquisition, M&M will have a strong position in the European forging industry. The acquisition will be funded through recently raised $300 million FCCB and also from internal accruals. Jeco's product portfolio includes gear boxes, engine and axle parts, hubs, gears and piston heads. The company has a forging production capacity of 1,00,000 tonne per anum. It supplies to auto giants like DaimlerChryser Group, ZF Group, Man Nutzfahrzeuge, Volvo, Renault, Agco, Kessler and Kolbenschmidt. In January 2006, M&M had bought a 98.6-per cent stake in Stokes Group Ltd, UK's largest forging company. [Via The Economic Times]
This means that domestic OEM
, September 28, 2006This means that domestic OEM players like Bharat Forge / Kalyani Brakes will have to brace themselves for competition from M&M ( now that its acquiring JECO). They'll have a common customer base comprsing the likes of Daimler Chrysler , Man , Volvo, Renault etc.
Augurs well ... the domestic OEMs will have to become more globally competitive to survive( or should I say thrive).