RSB group buys US auto components co for $19 m
The Pune-based RSB group, a $100-million company in the engineering and automotive components manufacturing business, today announced the acquisition of Miller Brothers Manufacturing, a Michigan-based privately-held automotive components and products manufacturing company, in a $19-million deal.
The deal was completed through a mix of debt and equity, where $3 million was raised by RSB as equity and $13 million as debt from a US-based bank, said Mr R.K. Behera, Chairman, RSB Group. The acquisition is expected to give RSB a base in the US and an increased access to the European markets. The addition of Miller Bros will significantly increase RSB’s international manufacturing, product design and marketing capacity and help it focus on increasing their market presence in the global arena, Mr Behera said.
MB Manufacturing is a $30-million specialty transmission component manufacturing company catering to, among others, GM Powertrain, American Axle Manufacturing, Eaton and several other major OEMs in the US. The core competency of MB Manufacturing is in making planetary gear housings and propeller shaft components and other transmission components using latest CNC equipment and robotics. It caters mostly to truck, SUV and off-road vehicle category.
RSB is envisaging major benefits by this acquisition including being able to bid and participate in large volume part-programme of US OEMs by a combined manufacturing strategy between RSB and MB. Mr Chris Miller ex-CEO, Miller Bros Manufacturing said, "We are very excited about this synergistic relationship. It allows us to leverage RSB’s comprehensive product offerings in the auto and heavy vehicles’ sector and strong quality processes in our customer base."
Expansion
RSB, meanwhile, is in expansion mode, currently putting up two new plants, one at Chennai for Caterpillar and the other at Uttaranchal , for Tata Motors. The company expects the turnover to go up from the current Rs 450 crore to over Rs 1,000 crore in 2008.
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