Fontana Gruppo, an Italian fasteners manufacturer, has agreed to pick up a majority stake in auto component maker Right Tight Fasteners Pvt Ltd to expand its presence in India.
The transaction involves Nashik, Maharashtra-based Right Tight taking over Fontana’s Indian operations and then the Italian group buying a 60% stake in the combined entity for about Rs 1,000 crore ($114.4 million), a person familiar with the deal told VCCircle.
Fontana operates in India through Aurangabad, Maharashtra-based BG Fastening and Engineering Industries Pvt Ltd.
Right Tight’s management will lead the combined company, which will be one of the largest manufacturers of fasteners in India.
Mid-market investment bank Lodha Capital acted as the exclusive financial advisor to Right Tight on the deal.
“The acquisition of RTF aligns perfectly with our long-standing localization strategy, building local facilities and organizations in key markets to better serve those same markets," said Fontana CEO Giuseppe Fontana. “India represents a growing economy of significant interest due to its scale and potential, and it serves as a gateway to the entire Far East.”
RTF, founded by Balbir Singh Chhabra in 1979, specializes in the production of high-strength bolts and nuts. Its clients include Tata Motors, Mahindra & Mahindra, Ashok Leyland, Bajaj Auto, TVS Motor, Royal Enfield, and Ola Electric. The company runs four factories across India and supplies to automotive, agricultural, industrial, and construction sectors.
RTF posted net sales of Rs 720 crore in fiscal year 2023-24, up from Rs 600 crore the year before. Its EBITDA stood at Rs 105 crore as compared to Rs 81 crore the year before.
Fontana operates in 32 locations across Europe, the Americas, and India. It has 21 production plants, employs over 5,000 people, and generates annual revenue of €1 billion.
Meanwhile, the transaction comes at a time when the auto components segment in India has seen quite a few deals.
Last month, private equity firm Carlyle forayed into India's auto parts industry with the acquisition of a controlling stake in a company created by merging two component manufacturers.
Bain Capital had invested in RSB Transmissions in 2024 while Warburg Pincus picked up a controlling stake in Imperial Auto Industries in 2022. Blackstone and Indian PE firm Kedaara Capital have also invested in the sector in the past.