The Hindu Business Line : Ashok Leyland buys US firm for Rs 70 cr

Chennai April 30 Ashok Leyland Ltd on Monday said that it had signed a share purchase agreement to acquire 100 per cent of the paid-up capital of Defiance Testing and Engineering Services Inc (DTE) based near Detroit, Michigan, in the US, for a consideration of $17 million (Rs 70 crore).

DTE is engaged in providing independent testing services for leading auto original equipment manufacturer and their Tier 1 and Tier 2 suppliers. DTE's capabilities are in the areas of laboratory-based testing and data acquisition, simulation durability testing, road-load data acquisition, safety testing and facilities management, and test laboratory consulting.

DTE is currently owned by GenTek Inc, USA. GenTek is selling DTE because it intends "to focus on our core chemicals and value train systems businesses," according to the company's President & CEO, Mr William Redmond.

Reducing debt

"We believe this transaction will provide significant benefits to GenTek shareholders by further reducing the company's long term debt," Mr Redmond said on Monday.

Ashok Leyland is buying DTE in order to strengthen its design and engineering services division, which provides these services to third parties. The acquisition of DTE will help Ashley Design and Engineering Services to enlarge its customer base and to serve automakers in the US.

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