Samvardhana Motherson To Acquire Honda Arm Yutaka Giken For Rs 1,610 Crore
The acquisition would also enable the company to potentially cross-sell Yutaka Giken's existing product portfolio to other OEMs, especially in emerging markets.
Auto components major Samvardhana Motherson International Ltd. on Friday announced the acquisition of Honda-owned Japanese company Yutaka Giken Co. for $184 million or Rs 1,610 crore.
The board approved plans to purchase an 81% stake with voting rights in Yutaka Giken and an 11% stake in Shinnichi Kogyo Co. through its indirect wholly owned subsidiary, Motherson Global Investments B.V., a stock exchange filing said.
YGCL is listed on the Tokyo Stock Exchange and Shinnichi is a subsidiary of YGCL. Honda Motor currently owns a 69.66% stake in Yutaka Giken and the rest is owned by the public.
Post completion of all steps, Honda will continue to own the remaining 19% voting rights shares of YGCL.
Samvardhana Motherson will also directly or through its wholly owned subsidiary, acquire 100% of the shares and voting rights in Yutaka Autoparts India Pvt. from YGCL.
Yutaka Giken makes metal components and assemblies, including rotors and stator assemblies for motors, drive systems, brake systems and thermal management systems. The firm has 13 manufacturing facilities and one R&D facility in nine countries across the world.
"The transaction would further strengthen the company’s global partnership with Honda and help expand the share of business with Japanese OEMs," SAMIL said in a statement.
The acquisition would also enable the company to potentially cross-sell Yutaka Giken's existing product portfolio to other OEMs, especially in emerging markets, it said.
The deal will require regulatory clearance from the authorities of Japan, the United States, China, Brazil and Mex
SAMIL Share Price
Samvardhana Motherson share price was trading 2% higher at RFs 93.95 by 11:15 a.m.
Samvardhana Motherson share price was trading 2% higher at RFs 93.95 by 11:15 a.m. The benchmark NSE Nifty 50 was up 0.2%.
The stock has fallen nearly 10% in the last 12 months and 28% on a year-to-date basis. The relative strength index was at 73.
Out of the 27 analysts tracking the stock, 22 have a 'buy' rating on the stock, two recommend a 'hold' and three suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price target implies a potential upside of 17%.
