Global auto ancillary major
Precision Camshafts Ltd has announced its second acquisition with the taking
over of German precision machinist Motoren und Fahrzeugtechnik GmbH (MFT)
through its wholly owned Duth subsidiary, PCL (International) Holding B.V.
PCL is one of the world's leading manufacturer and supplier of camshafts, a critical engine component, in the passenger vehicle segment. The company supplies more than 150 varieties of camshafts for passenger vehicles, tractors, light commercial vehicles and locomotive engine applications. The company specialises in the small and mid-size passenger vehicles segment and the key clients it caters to are GM, Ford, Hyundai, Mahindra, Escorts, Tata and Maruti Suzuki. PCL exports 78% of its total production to 5 continents and caters to approximately 9% of the global market.
The German company MFT enjoys
long term relationships with marquee global customers like Volkswagen, Audi,
Opel, Westfalia, Hatz, Suzuki, etc. MFT’s key products include balancer shafts,
camshafts, bearing caps, engine brackets and several non-engine prismatic
components. Located close to the Polish and Czech border, MFT manufacturers
critical components in its state of the art and cost competitive manufacturing
environment. The MFT team is led by Guido Glinski who has in-depth knowledge of
machining and is committed to growing the company. Guido Glinski is the MFT
Managing Director. He will continue to own 24% of the business and run the show
Announcing the latest
acquisition, Yatin Shah, PCL’s Chairman and Managing Director, said: “I am glad
to announce the acquisition of MFT, Germany. This acquisition is value
accretive which will open up synergetic opportunities for us through new
product offerings and will establish a global brand presence. MFT will not only
complement our relationships with current OEMs in that region but will also
help in enhancing our customer base. With MEMCO and MFT on board, we are
gradually progressing towards attaining our goal of transforming the business
profile, while the key focus area continues to be our legacy business. Further,
we remain committed to execute our planned business initiatives and capitalize
on larger growth opportunities at hand.”
“With PCL as our majority
investor, MFT is expanding its global footprint. It will allow us to get better
access to the development departments of the German and European car
manufactures. This will enable us to actively shape the disruptive changes in
the automotive industry and prepare ourselves for the challenges in the future
development of the conventional powertrain and become part of the alternative drivetrain
technologies. This also offers us and our employees a new vision for a
successful future. We are excited to walk that way with PCL to take advantage
of this opportunity and generate sustainable growth for the entire PCL Group”,
PCL Director and CFO, Ravindra
Joshi said “With the acquisition of MEMCO complementing our growth plans, we
now look forward to MFT contributing to the value add. The result of the
current expansion phase both organic and inorganic will be mostly witnessed in
the next financial year. Additionally, we would advise our investors to look at
the full year financials as opposed to the quarter, since the figures from the
Chinese joint ventures come in only at the year end at a net profit level.”
“PCL has begun its journey
towards global expansion by leveraging on its strong balance sheet to set a
footprint in the vast European market. With the merged know-how in
manufacturing, increased financial bandwidth from PCL and proximity to European
customers, there lies a great potential to scale the business in Europe. Our
focus remains to increase wallet share among existing customers of the acquired
companies”, said Karan Shah, PCL Business Development Executive.
In the recent past, PCL has
won a global contract from General Motors with aggregate value of Rs. 580 crore
over the lifetime and a global contract from Ford Motors with an aggregate
value of Rs. 550 crore. Both programmes are on track and will start serial
production in FY18-19. In addition to this, PCL has been recently awarded with
new contracts for fully machined camshafts from Ford, General Motors and
Mahindra & Mahindra with aggregate value of Rs. 275 crore over lifetime.
PCL operates through two
state-of-the-art manufacturing facilities - an EOU unit and a domestic unit
both situated at Solapur, Maharashtra. The EOU unit consists of four foundries
and two machine shops and the domestic unit consists of one foundry and one
machine shop. PCL has two joint ventures, the first with Ningbo Shenglong PCL
Camshafts Company Limited, for machining of camshafts and the second, PCL
Shenglong (Huzhou) Specialised Casting Company Limited, for casting camshafts
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