Extending its global footprint in the auto ancillary segment, the Rs 5,000 crore Ruia Group on Monday announced the acquisition of Germany based, Acument GmbH & Co KG, one of the leading manufacturers of automotive fasteners.
This is the third acquisition for the Ruia Group -- the owner of Dunlop India and Falcon Tyres -- in Germany and their fourth in Europe, in a span of three years.
In October-November last year, four bidders tried to acquire Acument, whose board of directors filed for insolvency in 2009, as the company incurred a loss of 40 million Euro in 2008 following the global economic meltdown, an official said.
Acument produces a wide range of high precision fasteners, like long shafted bolts, hexagonal screws, nuts and forged parts.
The Ruia Group emerged as the best bidder and signed the contract for the acquisition of Acument, which has a 15% market share in the fastener segment in Europe and had posted a turnover of 800 million Euro, before insolvency.
The group has acquired four plants of Acument in Neuss, Beckingen, Neuwied and Schorzberg, as well as its logistic centre in Koln in Germany.
"Our investment will be 4 million Euro in the company and we expect that the company's turnover would be 200 million Euro this year," Pawan K Ruia, chairman of the Group, told reporters.
Ruia said after this acquisition, the group's turnover this year was expected to be 335 million Euro with 50% coming from overseas operations.
"In the next two to three years we will bring fasteners products in India from Germany. We have no plan to shift the company here. We will be looking for additional manufacturing facilities in India," he stated.
Financing of the acquisition was done partly by internal accruals and rest was by three years sellers' credit.
"We find that the auto component industry is fast growing in India. Auto ancillary market now is about 26 billion dollar in the country and it will increase by five-fold by 2020. The acquisition will inevitably benefit the Indian market in technology enhancement," Ruia added.