Bharat Forge to acquire AAM India for Rs 545 crore

AAMIMCPL is a leading manufacturer of axles for light, medium and heavy-duty commercial trucks and passenger buses in India and was established in 2008.

Bharat Forge Limited on Thursday announced that it has entered into a definitive agreement to acquire AAM India Manufacturing Corporation Private Limited (AAMIMCPL), which is a subsidiary of American Axle & Manufacturing Holdings at an enterprise value of Rs 5,445.30 million (Rs 545 crore), subject to closing adjustments.

AAMIMCPL is a leading manufacturer of axles for light, medium and heavy-duty commercial trucks and passenger buses in India and was established in 2008."With this transaction, the company will acquire commercial vehicles axle business of AAMIMCPL in Pune (India) and Chennai (India) along with the Pune Engineering and Development Center. The transaction is subject to approval from the Competition Commission of India (CCI) and will close only after receiving the CCI’s approval and upon fulfilment of other customary closing conditions," the company said in a regulatory filing.

Amit Kalyani, Vice Chairman & Jt. Managing Director, Bharat Forge Limited said, “We are delighted to welcome the AAMIMCPL team to the Bharat Forge family. We look forward to relying on their technical expertise and existing relationships with various industry players to further scale-up the business over the medium to long term."

"AAMIMCPL’s acquisition, when completed, will be a significant milestone in our transformational journey of adding product solutions to our repertoire on the
vehicle component side. This transaction will enable BFL to get into a new business for manufacturing of products.” “The strategic decision to sell our commercial vehicle axle business in India enables us to strengthen our focus on ICE, hybrid and full electric passenger vehicle, pickup truck/SUV, and van applications globally and provides additional financial flexibility,” said David C. Dauch, AAM Chairman and Chief Executive Officer.

“We are committed to collaborating with Bharat Forge to execute this agreement efficiently and support the continuity of supply from these facilities to customers during the ownership transition.” The transaction is subject to customary closing conditions, including the receipt of regulatory approvals.

The shares of Bharat Forge wa strading at Rs 1,460.25 at BSE and was down by 1% at 2.30 pm. Lincoln International acted as the sell side advisor to the deal.