Indian auto parts maker Samvardhana Motherson International (SMIL) said on Tuesday it will buy a majority stake in Japan-based auto-part maker Yachiyo Industry's four-wheeler business from Honda Motor Co to expand its product range.
The transaction is valued at 22.9 billion Japanese yen ($158.54 million) for a 100% stake in Yachiyo, SMIL said.
Honda currently owns a 50.4% stake in Yachiyo. As part of the transaction, Honda will first buy out the entire public stake in Yachiyo via a tender offer and retain Yachiyo's two-wheeler business.
SMIL will acquire an 81% stake in Yachiyo's four-wheeler business, while Honda will have a 19% stake.
Yachiyo makes automobile parts like sunroofs, fuel tanks and resin products.
The acquisition will provide SMIL access to research and development capabilities and foray into the global sunroof market and also pursue other partnerships with Honda, the Bengaluru-based company said in a statement.
"The close proximity to Honda Motor plants across the globe provides an opportunity to offer existing products of Motherson to Honda Motor globally," SMIL added.
Yachiyo's four-wheeler business employs about 3,200 people in manufacturing, research and development centers across eight countries including the U.S., Brazil, Mexico, China, Japan, Thailand, Indonesia and India, SMIL said.
Yachiyo's business has a book value of 59.2 billion yen as of March 31, reported revenue of about 116 billion yen and earnings before interest, taxes, depreciation, and amortization of 13 billion yen, according to SMIL's statement.
The acquisition needs approval from authorities in China, Brazil and the United States, as well as the Reserve Bank of India, SMIL said.
