Sona Group Buys Out Mitsubishi Arm’s Stake In Precision Forging Business
The Group has not taken any debt for the payout to Mitsubishi.
Gurgaon-based auto parts maker Sona Group will buy out Mitsubishi Materials Corp’s 25 percent stake in its precision forging joint venture, said group chief executive officer Sunjay Kapur.
The deal comes a month after the group sold its 25.1 percent stake in its flagship company, Sona Koyo Steering Systems Ltd., to the Japanese partner JTEKT Corp. for over Rs 400 crore. The company has used the funds from the earlier deal to buy out Mitsubishi’s stake in Sona BLW Precision Forgings, said Kapur.
The joint venture with Mitsubishi Materials was formed in 1995.
The company has seven manufacturing units across India, Germany, and Hungary, and Sona Group has plans to invest another Rs 300-400 crore over the next three-four years, Kapur said, adding that around Rs 100 crore had been earmarked for the next financial year.
It supplies components to global players like Volkswagen AG, Renault AG, BMW AG and Indian companies like Maruti Suzuki India Ltd., and Mahindra & Mahindra Ltd.
The precision forging company now wants to enter Indian railways and the defence vehicles space with Kapur calling it a “natural progression”. The Group has plans to supply components to Indian railways companies, and is also in talks with a few for the same, Kapur said, without giving further details.