Kolkata: Ruia Group, which owns Dunlop Tyres in India, today announced that it has acquired German sealing system maker Henniges Automotive, which had gone into liquidation in 2008 during the global economic crisis.
Ruia Group has taken over 60% through a special purpose vehicle routed through a Mauritius-based investment company, Wealth Sea. The remaining 25% is held by German court appointed administrator for Henniges Wolf Von Der Fecht and 15% by existing director Juregen Hein.
Ruia said the group has the option to acquire 25% after three years from the administrator and the remaining 15% after five years from the director.
The Ruia Group will pay for the 60% in three installments over as many years. Group chairman Pawan K Ruia said the group was looking forward to having an automotive sealing company in India using technologies of global leaders.
Henniges is the second acquisition in the global sealing segment after Schlegel Automotive of UK by the Group. Henniges is structured in a unique fashion in which the four original equipment manufactuers (OEMs) offered credit line of 30% of the takeover valuation against adjustment for supply.
Fecht said “all the four OEMs have base in India and were comfortable with Ruia Group’s business model. They can continue to get supplies of sealing components in India.”
Henniges German unit is a major supplier of automotive sealing systems to global majors like Daimler, BMW, Audi and Volkswagen.
Though, the new company is debt free as the acquisition was without liabilities, Fecht said a sum equivalent to one-third of the total acqusisition cost has to be repaid to existing creditors in the next three years.
The Group outbid 28 international companies to acquire Henniges Automotive Grefrath GmbH, now renamed as DRAFTEX
“Aspiring to be a global major in the business of manufacturing automotive sealing systems and an important player in the auto ancillary business, we have achieved a milestone by taking over the German company,” Ruia told reporters here.
For 2010, the turnover projection for Henniges was pegged at €45-50 million and with Schlegel the combined turnover would be €82 million.
Henniges turnover had hit €50 million from €84.9 million in 2008.
With 400 highly-skilled employees on its roll, Henniges aims to increase business with a secure order book from the existings OEMs for the next four years