Automotive parts manufacturer Motherson Sumi Systems Ltd will enter the Turkish market with the acquisition of two companies through a subsidiary.
The Noida-based company in a statement said its subsidiary, Samvardhana Motherson Automotive Systems Group BV, will acquire majority stakes in Plast Met Plastik Metal San. İmalatveTic.A.Ş.(PM-Bursa) and Plast Met Kalıp San.veTic.A.Ş.(PM-Istanbul), collectively known as the Plast Met group.
In a filing with stock exchanges, Motherson Sumi said it will acquire 75% of the two companies, which reported combined revenues of €33.4 million in 2019.
While the company did not disclose the price at which the acquisition will take place, it said the final purchase amount for the Plast Met companies will be 75% of the equity value determined from a base enterprise value of €21.78 million (around $26.4 million or Rs 193.2 crore).
The acquisition will help Motherson Sumi with its expansion into Turkey, which the company says holds long-term growth potential for it.
Motherson Sumi expects these acquisitions to close within three months, and hopes them to be EPS (earnings per share) accretive.
“This is the 25th acquisition by Motherson Group,” Motherson Group chairman Vivek Chaand Sehgal said.
This development comes around three months after Motherson Sumi signed a strategic agreement to acquire the electrical wiring interconnection systems business of Bombardier Transportation, the rail equipment division of Bombardier Inc.
Shares of the company ended trading on Tuesday up 1.62% at Rs 159 apiece. The automotive parts manufacturer reported consolidated net sales of Rs 63,537 crore and net profit of Rs 1,294 crore for the 2019-20 financial year.