Zetwerk acquires US-based Unimacts for $39 million, to clock a revenue of $1 billion in FY23

Amrit Acharya, cofounder and chief executive officer of Zetwerk. Image Credits: VCCircle

Business-to-Business (B2B) manufacturing service unicorn Zetwerk has acquired US-based industrial manufacturing firm Unimacts for a total deal size of $39 million and is planning to clock more than $1 billion of revenue for the financial year ending 2023.

“Last year around 12% of our revenue came from the non-India market which is mostly the US and within that the sector was renewables. Globally there is a push for renewables…Unimacts is a company that specialises in solar and with this acquisition we want to be closer to our customers in the US,” said co-founder and chief executive officer of Zetwerk Amrit Acharya in interaction with Moneycontrol.

Zetwerk’s focus on the US market also comes on the back of the country’s recent introduction of the inflation reduction act of 2022 and the US Infrastructure Bill which is similar to India’s PLI scheme that incentivizes Make-in-US companies and industries.

Acharya also said that with this acquisition, Zetwerk will build a large team including hiring for the management and across the departments in the US, and plans to invest more in the growing renewables sector.

“We want to invest more in the US market over and above this acquisition and that will lead to additional headcount within the firm as well,” he said. The firm’s overall workforce post this acquisition will be around 1900.

In 2022 Zetwerk acquired three Indian manufacturing supply chains across aerospace & defense, oil & gas, and railways segments which are Pinaka Aerospace, SharpTanks, and Wheels India.

Zetwerk’s acquisition of Unimacts will be the firm’s first international acquisition and will position the company for additional expansion and diversification, providing immediate access to marquee solar and wind-power customers.

The executive team at Unimacts, including Matthew Arnold, CEO, Andrew Woglom, CFO, and Alan Hays, COO, along with the team at Unimacts, will be joining Zetwerk, the firm said in a media statement.

For Unimacts, this acquisition will equip the company with the necessary capital to scale up its presence in the U.S., Europe, and Mexico, along with access to a strong off-shore footprint in India and Vietnam. Overall, Unimacts’ customer relations, supply partners, and business operations will remain unaffected, the statement said.

Zetwerk’s 2021-2022 financial results showed that the gross merchandise value grew six-fold, to $770 Million from $130 Million, and the operating revenue expanded to $670 Million from $110 Million in 2020-2021.

Acharya said that the firm is on track to do well over $1 billion in revenue in the current fiscal year and may go for an IPO in the future when market conditions are supportive.

“We are very well capitalised and looking to clock a revenue of $1 billion in revenue for FY23… we are even thinking about going public but we do not have a definite timeline,” Acharya said.

Zetwerk has more than 2000 customers across North America, Asia-Pacific, and the Middle East, and a network of more than 10,000 manufacturing partners worldwide.

In 2020-21, the company also decided to diversify its services beyond India and ventured into international markets such as North America. It also added consumer business to its portfolio in addition to the industrials segment.

“Lot of Indian brands used to get their electronics from China and other countries and that is changing rapidly…there is a lot of incentive as well in this. We are pretty committed to this industry and the long-term trends are very favorable,” Acharya added.

Founded in 2018 by Amrit Acharya, Balaraman Ramakkrushnan, Rahul Sharma, Srinath Ramakkrushnan, and Vishal Chaudhary, the company has raised $554 million in funding to date. The company counts Lightspeed, CRED founder Kunal Shah and Oyo’s Ritesh Aggarwal also as its backers.

In August 2021, Zetwerk raised around $150 million in funding from D1 Capital Partners and turned into a unicorn with a valuation of $1.3 billion.