Leading Tier-1 automotive systems and components supplier Lumax Auto Technologies (LAT) has signed an agreement to acquire a majority stake in IAC International Automotive India from the International Automotive Components Group. KPMG Corporate Finance acted as the exclusive financial advisor for the transaction.
The acquisition will take place at an equity valuation of INR 587 crore, and IAC will continue to hold a 25% stake; 75% of the stake will be bought through SPV (acquisition vehicle) at INR 440 crore, which will be paid in cash funded by debt & internal accruals. The strong free cash flow generation in LAT and IAC India will ensure debt repayment in five years.
IAC is a leading global supplier of powertrain-agnostic automotive interior and exterior systems and components, including instrument panels, cockpits and consoles, door and trim systems, headliner and overhead systems and other interior and exterior components. With global revenues in excess of $3 billion, it is a strategic supplier to leading automotive OEMs worldwide and operates 45 manufacturing facilities across 17 countries.
With five manufacturing plants (two in Chakan and one each in Manesar, Nashik and Bangalore) and an Engineering centre in Pune with key capabilities in Product Designing & Engineering, Dimensional Engineering, Product Development, Programme Management and Tooling development, IAC India is a Tier-1 interior systems and components supplier to key automotive OEMs in India, including Mahindra, Maruti Suzuki, Volkswagen and Volvo Eicher Commercial Vehicles.
IAC India’s day to day business and operations will continue to be managed by its existing professional management team which has successfully delivered strong and consistent results over the last decade.
Deepak Jain, Chairman, Lumax, said, “This is a marquee milestone in our long-term growth goals of strategic partnerships with global industry leaders. With our group’s existing expertise in automotive lighting and plastics, it provides the opportunity to combine competitive strengths across automotive lighting, plastics and interiors to provide complete solutions to our customers. We are excited with the opportunity to partner with IAC and work together with the team at IAC India with the overall vision of stability, continuity and growth in the coming years.”
David Prystash, Chief Executive Officer, IAC Group, said, This partnership will offer immense opportunity to expand our business in India and continue to deliver quality solutions to our customers. It also offers the opportunity for industry leaders in lighting and interior systems to offer integrated solutions to meet the rapidly evolving technological advancements in the automotive sector.”
Anmol Jain, Managing Director, Lumax, said, “This strategic partnership will help us expand our existing business in four-wheeler automotive plastics and serve our customers with a wider product range. As the sector moves towards higher value-added and niche content in interior systems, we will look to leverage this platform to deliver industry leading solutions to our customers and enhance our kit value per vehicle.”
Sunil Koparkar, Managing Director, IAC India, said, “This partnership will provide us the platform to combine world-class technology and engineering capabilities, complimentary products, customer relationships, manufacturing excellence and a strong independent professional team to take the business to the next level in the coming years”.
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