New Delhi: Indian auto parts maker Samvardhana Motherson International (SMIL) announced to buy of a majority stake in Japan-based auto-part maker Yachiyo Industry’s four-wheeler business from Honda Motor Co to expand its product range. Yachiyo makes automobile parts like fuel tanks, resin products and sunroofs.
For a 100% stake in Yachiyo, the transaction is valued at 22.9 billion Japanese yen ($158.54 million), SMIL said.
Currently, Honda owns a 50.4% stake in Yachiyo. Honda will first buy out the entire public stake in Yachiyo via a tender offer and retain Yachiyo’s two-wheeler business as part of the transaction.
In Yachiyo’s four-wheeler business, SMIL will acquire 81%, while Honda will have a 19% stake.
The Bengaluru-based company SMIL said in a statement that this acquisition would provide the company access to research and development capabilities and foray into the global sunroof market and also pursue other partnerships with Honda.
“The close proximity to Honda Motor plants across the globe provides an opportunity to offer existing products of Motherson to Honda Motor globally,” SMIL added.
SMIL said that Yachiyo’s four-wheeler business employs about 3,200 people in manufacturing, research and development centers across eight countries, including the U.S., Brazil, Mexico, China, Japan, Thailand, Indonesia and India.
According to SMIL’s statement, Yachiyo’s business has a book value of 59.2 billion yen as of March 31, reported revenue of about 116 billion yen and earnings before interest, taxes, depreciation, and amortization of 13 billion yen.
The acquisition needs approval from authorities in China, Brazil and the United States, and the Reserve Bank of India, SMIL said.
