Tata Opportunities Fund, the flagship private equity fund of Tata Capital, has invested Rs 300 crore in Varroc Engineering Pvt Ltd, the holding company of the Rs 6,900-crore auto component conglomerate Varroc Group.
Varroc would utilise the funds to expand its capacity and partly pay off its outstanding debt.
The group’s domestic businesses are geared towards two-wheeler segments with a strong presence in plastics and polymers, metallic parts and electrical components. Over half of the group’s revenue accrues internationally, where it is among the global leaders in automotive lighting systems for passenger vehicles.
Varroc had acquired the global automotive lighting business of Visteon (formerly a division of Ford) in 2012. Apart from 21 manufacturing plants in all major auto hubs across India, Varroc has a global manufacturing footprint in low-cost countries spanning Mexico, China and the Czech Republic.
The group has marquee clients, including Jaguar Land Rover, Ford, Tesla, GM, Volkswagen, Bentley and Nissan, in the global market, and players such as Bajaj, Honda, Yamaha, Hero, Royal Enfield, Mahindra and Tata Motors in the domestic market.
With the investment, the Tata Opportunities Fund has consummated its first manufacturing company investment, which incidentally, is also its first investment outside of the Tata group. The fund’s prior investments were into Ginger Hotels, and Tata Sky.