Indian auto parts maker Amtek Auto on Wednesday said it had acquired UK-based rival Triplex-Ketlon Group, consolidating its precision machining operations into one of the largest in Europe.
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Amtek paid $US40m (INR1.57bn) for the acquisition in an all-cash deal, finance director Santosh Singhi told Reuters. The acquisition will help bring considerable cost savings due to variable and fixed cost synergies.
“The forgings and castings will be sourced from domestic units in India, which should save 25-30% of the component cost,” Singhi told the news agency.
He estimated additional revenue of $70-80m yearly on this account, and annual cost savings of $16-18m by the third year.
Triplex-Ketlon, which counts Land Rover, Ford and JCB among its customers, will give Amtek entry into high-value gear manufacturing segment and also provide access to very high-growth Japanese original equipment makers like Toyota and Honda in Europe, Reuters noted.
“We will add many products like ladder frames and engine covers in our portfolio, and also add to market share,” Singhi told the news agency.
The UK firm would also help Amtek add three manufacturing facilities in that country, in addition to its existing two facilities there.
Reuters said Triplex-Ketlon’s products include engine and transmission covers, brake discs, gears, shafts and sprockets and all its current customer contracts are long term.
Triplex-Ketlon’s $152m per year sales will boost Amtek’s revenues in the UK alone to $650m and overall international revenues to $770m per year, the report added.
Amtek has targeted crossing $1 billion per annum in international revenue within two years, but Singhi reportedly said the company could reach the milestone within six months through another acquisition in Europe.
