Home-grown auto component maker Motherson Sumi Systems (MSSL) on Friday offered to buy Finland-based truck wire maker PKC Group Plc for about ₹4,150 crore. If successful, the acquisition will strengthen MSSL’s position in the European markets and also give it access to China’s wiring harness market.
It would also be the company’s biggest acquisition so far, and one of the biggest in the Indian auto components manufacturing sector.
“We are present in most of the countries for rear-view mirrors and electrical distribution systems, but this acquisition will help us double our wiring harness business, especially for commercial vehicles segment in the European markets and other geographies too,” MSSL’s Chief Financial Officer GN Gauba said, adding that in 2015-16, the company’s wiring harness business contributed €800 million to its overall revenue.
MSSL will fund the deal through the ₹1,993 crore it raised through a qualified institutional placement in September and internal cash accruals.
He said the PKC buy will raise its global headcount to around one lakh, from 84,000 employees. The Nasdaq- and Helsinki Stock Exchange-listed PKC has 22,000 employees with manufacturing facilities in the US, Brazil, China, Mexico, Russia and Germany. As of 2016 end, it has estimated revenue of around €846 million.