Samvardhana Motherson acquires Japan's precision component maker Atsumitec for $57 million

Samvardhana Motherson announces acquisition

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Samvardhana Motherson has announced an acquisition of Japan-based high-precision component maker Atsumitec for $57 million, in which the company will hold 95% stake with the rest of the 5% to be owned by Honda Motors.

Shares of Samvardhana Motherson were higher by over 3% in mid-day trade soon after the announcement of the acquisition, but cooled off later to trade flat.

Atsumitec is into the production of high precision machined components, including gear shifters, chassis and transmission parts for 4-wheelers as well as 2-Wheelers, with FY24 turnover at $412 million. As per current shareholding pattern, Honda Motor was in possession of 48% stake in the company.

Through the acquisition, SMIL said it is aiming to expand the share of its business with Japanese OEMs and improve its penetration in that market. The competencies of Atsumitec will also enable Samvardhana's entry into new product lines such as chassis and transmission parts for 4W and 2Ws. The acquisition also enables SMIL's entry into new geographies like Vietnam for the 2W segment.

Atsumitec's global subsidiaries will give SMIL access to global metal and machining capabilities, along with customer diversification and cross-sell opportunities, Samvardhana said. Atsumitec has direct and indirect subsidiaries in Thailand, Hong Kong, USA, Vietnam, China, Japan, Indonesia and Mexico, all of which have been acquired as part of the transaction.

Samvardhana Motherson International (SMIL) will complete the acquisition through a subsidiary in multiple steps, the company said. The transaction is expected to be completed by Q1FY26, ultimately resulting in 95% ownership for SMIL and 5% for Honda Motor.

Atsumitec is a supplier to marquee Japanese OEMs such as Honda Motor, Toyota, Mitsubishi, Suzuki, Daihatsu, among others, with nine facilities and over 3,400 employees.