Bangalore-based automotive springs manufacturer Stumpp Schuele & Somappa Springs Pvt Ltd (SSSS) has spun off its coil spring business into a joint venture with Japanese firm Mitsubishi Steel Mfg Co Ltd (MSM).
As a part of the deal it has sold the business to its subsidiary Stumpp Schuele & Somappa Auto Suspension Systems Pvt Ltd and sold an undisclosed stake in this firm to MSM. The JV firm is in the process of manufacturing coil springs and stabiliser bars.
The Bangalore-based firm has also formed a separate JV with MSM for manufacturing construction machinery recoil springs that will be based out of Chennai.
J. Sagar Associates advised SSSS on both the JV formations and MSM, Japan was represented by Herbert Smith Freehills, Japan and DSK Legal, New Delhi.
SSSS is a part of MG Brothers Group, which is into various businesses such as transportation & auto dealerships, agriculture and real estate etc. Established in 1960, SSSS has a capacity to convert 15,000 tons of steel into springs each year.
The firm has 12 plants manufacturing more than 4,000 varieties of springs. Its clientele portfolio includes Ford, General Motors, Hindustan Motors, Honda, Tata Motors among others.
In February 2011, SSSS had sold its stake in Bangalore-based Compact Automotive Lamps Pvt Ltd to Osram India Pvt Ltd for an undisclosed amount.
MSM is engaged in the manufacturing and sale of steel products. The company operates in five business segments including specialty steel products, spring, fabricated materials, equipment & device segment and others.
One year ago, the Japanese firm merged its two Canada-based arms- MSM Canada Inc and MSM (N) Canada Inc to form new entity called MSSC Canada Inc in which it has 87.1 per cent stake.