Motherson Sumi Systems Ltd (MSSL) has announced recently that it has acquired the Finland based global auto component major PKC Group Plc for approximately Euro 571 million., a move that will help Mr. Vivek Chaand Sehgal’s group to expand its footprint significantly in American and European commercial vehicle market segment.
Announcing the deal closure, MSSL’s Chairman, Mr. Vivek Chaand Sehgal said, “We are very happy to announce that we have successfully acquired 93.75% (balance being acquired by subsequent offer / squeeze out process) shareholding in PKC Group which has significant market presence in the American and European markets with major growth plans in China. This is in sync with our declared policy of focusing on these markets to create enhanced value for all our stakeholders including investors.”
“MSSL has always believed in both organic and inorganic growth and has seen an average annualized growth of 40 per cent over the last ten years. We wish to thank all our shareholders for being part of the growth story of the company owned by them. I see tremendous growth potential ahead and we will continue to work towards becoming a globally preferred solutions provider for the transportation industry” added, Mr. Sehgal.
MSSL will continue to keep its focus on providing full system solutions to its customers globally. With the operational expertise of MSSL and technical know-how of PKC, the company will add more value to its customers and suppliers. MSSL’s success in managing its wiring harness business with a focus on training its’ people, managing multiple plants with high degree of vertical integration from design to modules will help unlock the full potential of PKC.
This is the 16th acquisition by MSSL since 2002. A focused approach to product and market expansion has helped the company reach a turnover of USD 5.7 billion by FY15-16 and will help move forward towards the target of USD 18 billion along with business philosophy of 3CX15 meaning exposure to any country, component or customer should not be more than 15% of its total turnover by FY 2020.
As announced earlier on 19th Jan 2017, MSSL and PKC entered into a combination agreement pursuant to which MSSL launched a voluntary recommended public tender offer for the acquisition of all the issued and outstanding share capital and voting rights of PKC Group Plc (PKC). The tender offer was launched on 6th of February 2017. Shareholders of PKC, which had a topline of Euro 846 million during calendar year 2016 and Adj. EBIDTA of Euro 64.4 million were offered EUR 23.55 per share in tender offer. Total consideration paid for this acquisition is approximately Euro 571 million. Based on the overwhelming response received from the shareholders of PKC, the deal was completed within the estimated time. The company has also obtained all pre-closing regulatory approvals for the transaction prior to completion of the tender offer.