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Our Bureau

New Delhi, Jan. 2 The Rs 2,000-crore plus auto component maker, Motherson Sumi Systems Ltd, on Friday announced its seventh acquisition by buying out the businesses of one of the world’s largest rear view mirror producers, Visiocorp for an undisclosed amount.

The European company Visiocorp clocked a revenue over €700 million last year and has about 17 manufacturing locations across Europe, the US, Australia and Asia. While the acquisition will be mainly funded through internal resources of Motherson Sumi, the company will also set up a special purpose vehicle for €30 million. This would be a step down subsidiary between Motherson Sumi and Samvardhana Motherson Finance Ltd in the ratio of 51:49.

“We will be able to disclose the amount of acquisition only by February end by when we would have completed the entire process. However, a large part of the acquisition will be funded through internal resources, ” Mr G.N. Gauba, the company’s Vice President, Finance, told Business Line.

He said that the special purpose vehicle will buy the new company, raise the required amount of debt to fund the acquisition and also infuse additional investments required.

Motherson Sumi already has a joint venture with Visiocorp for the domestic market under which it holds 49 per cent, with the remaining stake held by its European counterpart.

The company currently enjoys 45 per cent of domestic market share in mirrors for passenger cars.

After the acquisition, the company will emerge as the largest player globally with clients such as General Motors, Hyundai, Ford, Volkswagen, Renault and BMW.

Motherson Sumi group makes diverse parts like wiring harness, air compressors, metal parts and fuel pump parts and has 12 joint venture companies.

The company’s shares which opened at Rs 60.10 on the BSE on Friday closed at Rs 64.05.

More Stories on : Automobile Components | Overseas Investments | Mergers & Acquisitions

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