Auto-component maker Motherson Sumi Systems Ltd said it will acquire Bombardier Transportation (Rolling Stock) UK Ltd's assets used to produce and install electrical components and systems for the rail industry.
Motherson Sumi has agreed to pay £10.87 million (Rs 102 crore or $14.4 million) for the transfer of assets, employees and inventories minus Bombardier's debt and cash, the auto ancillary company informed stock exchanges.
The transaction is being routed through Finland-based publicly traded wiring systems and electronics company PKC Group, which Motherson Sumi acquired nearly two years ago to expand its footprint in the American and European commercial vehicle segment.
The assets comprise Bombardier's manufacturing of wiring harnesses, panel and cabinet build and electromechanical assemblies in Derby, UK. As part of the deal, Motherson Sumit will also lease Bombardier's Derby site and continue to operate the business with existing employees.
The acquisition, expected to close by next quarter, will help Motherson Sumi expand its supply of electrical and wiring systems to Bombardier Transportation and cover UK rolling stock projects.
The asset purchase from Bombardier in the UK is Motherson Sumit's first acquisition for 2019. The company struck several acquisitions last year and has been scouting at least half a dozen targets to expand its global footprint.