As per reports, the $1-billion Amtek Group’s flagship Amtek Auto is believed to be clinching the deal to take over the foundry business of the UK-based auto component major JL French Castings.
The acquisition is estimated between Rs 150 crore and Rs 160 crore and includes the company’s operations in Whitham in the UK. Amtek Auto would fund the acquisition through $250 million foreign currency convertible bonds (FCCBs) it issued in May 2006. The company is eyeing the US firm to gain a foothold in the aluminium case components business and to gain market access to the European Union.
The US firm will also help bring expertise to Amtek Auto in the manufacturing of cylinder heads, transmission case and engine blocks.
The turnover of JL French Castings’ foundry business is Rs 240 crore ($70-80 million) and expected to touch $150 million in the next three years. The company has a capacity of about 20,000 units and services original equipment manufacturers like Jaguar, Land Rover, Ford and Peugeot among others.
Net profit of Amtek Auto rose 47.78% to Rs 65.32 crore in Q3 March 2007 as against Rs 44.20 crore in Q3 March 2006. Sales were up 35.97% to Rs 314.64 crore ( Rs 231.41 crore).
In March 2007, Amtek Auto had inked a 50:50 joint venture with VCST Industrial Products of Belgium with headquarters in Sint Truiden, Belgium, to set up a state-of-the-art manufacturing facility for powertrain components in India. The JV will primarily focus on the manufacture of gears and shafts for automotive on- and off-road applications.