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MUMBAI , September 20, 2017 21:50 IST
Updated: September 20, 2017 21:51 IST
http://www.thehindu.com/business/In...ys-erkunt-traktor-foundry/article19722502.ece
Mahindra eyes farm mechanisation market in the European nation, where tractor sales total $1.7 bn
Mahindra & Mahindra Ltd. (M&M) has signed a definitive agreement with Turkey’s Armagan family for acquiring 100% of Erkunt Traktor Sanayii A.S., the fourth-largest tractor manufacturer in Turkey.
M&M, the global tractor industry’s number one maker by volume and fifth-largest in terms of revenue, also agreed to acquire 80%-100% equity in Erkunt Sanayii A.S, a foundry unit belonging to the same Turkish group.
While the tractor firm has an enterprise value of $76 million (₹479 crore), the foundry unit’s value has been estimated at $51 million (₹321 crore). The final transaction value would be estimated at the close of the deal, expected in about two and half months.
The Turkish companies have some debt which would continue and would be repaid by them, top M&M officials said. M&M would fund the acquisition through internal accruals, they added.
The deal, which follows the Hisarlar acquisition earlier this year in Turkey, would help M&M expand its farm equipment business in that country, a strategic market for farm equipment globally, the firm said.
‘Eyes exports’
Erkunt would export tractors to the neighbouring markets of West Asia, CIS and Europe. The Ankara-based company, which currently has a 6% share of Turkey’s $1.7 billion tractor market, is expected to gain business after the acquisition, M&M officials said.
“Our strategy is to globalise aggressively and also expand our portfolio to include various new categories of tractors and farm machinery,” Pawan Goenka, MD, M&M, said while announcing the deal. This is the company’s fifth acquisition in the farm equipment space. “Turkey is a very important market in our globalisation journey and we wish to participate in its entire agri mechanisation landscape,” he said.
M&M will retain Erkunt’s brand. The Turkish firm, which sold 4,700 tractors worth $88 million last year, has 353 employees. The foundry, a service provider from castings to machining, had revenue of $47 million.
Updated: September 20, 2017 21:51 IST
http://www.thehindu.com/business/In...ys-erkunt-traktor-foundry/article19722502.ece
Mahindra eyes farm mechanisation market in the European nation, where tractor sales total $1.7 bn
Mahindra & Mahindra Ltd. (M&M) has signed a definitive agreement with Turkey’s Armagan family for acquiring 100% of Erkunt Traktor Sanayii A.S., the fourth-largest tractor manufacturer in Turkey.
M&M, the global tractor industry’s number one maker by volume and fifth-largest in terms of revenue, also agreed to acquire 80%-100% equity in Erkunt Sanayii A.S, a foundry unit belonging to the same Turkish group.
While the tractor firm has an enterprise value of $76 million (₹479 crore), the foundry unit’s value has been estimated at $51 million (₹321 crore). The final transaction value would be estimated at the close of the deal, expected in about two and half months.
The Turkish companies have some debt which would continue and would be repaid by them, top M&M officials said. M&M would fund the acquisition through internal accruals, they added.
The deal, which follows the Hisarlar acquisition earlier this year in Turkey, would help M&M expand its farm equipment business in that country, a strategic market for farm equipment globally, the firm said.
‘Eyes exports’
Erkunt would export tractors to the neighbouring markets of West Asia, CIS and Europe. The Ankara-based company, which currently has a 6% share of Turkey’s $1.7 billion tractor market, is expected to gain business after the acquisition, M&M officials said.
“Our strategy is to globalise aggressively and also expand our portfolio to include various new categories of tractors and farm machinery,” Pawan Goenka, MD, M&M, said while announcing the deal. This is the company’s fifth acquisition in the farm equipment space. “Turkey is a very important market in our globalisation journey and we wish to participate in its entire agri mechanisation landscape,” he said.
M&M will retain Erkunt’s brand. The Turkish firm, which sold 4,700 tractors worth $88 million last year, has 353 employees. The foundry, a service provider from castings to machining, had revenue of $47 million.
