Havells India looks for acquisitions in China, Africa

Electrical goods maker Havells India is mulling over acquisitions in China and Africa that may entail an investment of up to USD 200 million (about Rs 1,100 crore) to strengthen its overseas operations.

The company is also expanding presence in other nations like Turkey, Russia, Indonesia and Malaysia. "We are open for any strategic acquisition in those locations, such as China and Africa, where we are not present now," Havells India Joint Managing Director Anil Gupta told PTI. Last year, the company had formed a manufacturing joint venture with a local Chinese firm to produce various lighting products for its overseas markets, he added. "We are keeping our eyes open. In fact, we have talked to some in China, but nothing worked out," Gupta said, adding the company is also looking for targets in Africa. Havells India may see an acquisition happening in the Chinese market within next three years, he added. When asked about the size of the acquisition that the company is considering, Gupta said: "We are looking for not so small or not so big firms to acquire. The size of any acquisition will be from USD 50 million to USD 200 million." The company will fund this amount through internal accruals only, he added. So far, the company's biggest acquisition has been that of Sylvania in Europe for 230 million euro (over Rs 1,500 crore) in 2007. Last year, Havells India had formed a 50:50 joint venture with Shanghai Yaming Lighting Co to set up a manufacturing facility at Jiangsu province in China. The JV, Jiangsu Havells Sylvania Lighting Co Ltd, would invest up to USD 100 million (nearly Rs 530 crore) in the next three years. Talking about its other overseas locations, Gupta said: "At present, 90 per cent of our exports revenue come from the Western Europe nations. We now want to focus on Eastern Europe too. We have recently opened our offices in Turkey and Russia. We will focus to establish our brands in these markets." Similarly, the company has also established its offices in Indonesia and Malaysia, which has strong growth potential, he added. In 2011-12, Havells posted a total turnover of Rs 6,500 crore. Out of this, its exports contributed Rs 3,000 crore. The company has 10 manufacturing facilities in India in various locations, including Himachal Pradesh, Uttar Pradesh and Rajasthan. Havells India also has seven overseas manufacturing plants in Europe, Middle East and Latin American regions.