Corporate Development     

Published: November 15, 2024
Updated: November 15, 2024

Bharat Forge Ltd

BFL buys axle maker for Rs 545 cr

Bharat Forge Limited (BFL), has entered into a definitive agreement to acquire AAM India Manufacturing Corporation Private Limited (‘AAMIMCPL’), a subsidiary of American Axle & Manufacturing Holdings Inc. (AAM), (NYSE: AXL), at an enterprise value of Rs 5,445.30 million, subject to closing adjustments.

Established in 2008, AAMIMCPL is a leading manufacturer of axles for light, medium and heavy-duty commercial trucks and passenger buses in India. With this transaction, the company will acquire the commercial vehicles axle business of AAMIMCPL in Pune and Chennai along with the Pune Engineering and Development Centre. 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.

Amit Kalyani, Vice Chairman and Joint Managing Director, BFL, commented, “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.”

He added, “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.”

‘STRATEGIC SALE’

David C. Dauch, AAM Chairman and Chief Executive Officer said, “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 vehicles, pickup trucks/SUVs and van applications globally and provides additional financial flexibility.” He added, “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.”

It’s worth mentioning that since 1981, the Kalyani group already has a listed joint venture arm, Automotive Axles Ltd, with Meritor Inc of the US, with manufacturing facilities located at Mysuru and Jamshedpur. It manufactures drive axles, nondrive axles, front steer axles, speciality and defence axles, etc, for the major domestic and global manufacturers of trucks and buses. Both the JV partners hold 35.52% each and the balance 28.96% is with the public.

INDIAN & GLOBAL

BFL, a Pune-based Indian multinational, is a technology-driven global leader in providing high performance, innovative, safetycritical components and solutions for several sectors, including automotive, power, oil & gas, construction & mining, rail, marine, defence and aerospace.