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Home arrow News arrow Mergers and Acquisitions arrow Sintex acquires automotive biz of Bright Brothers
Sintex acquires automotive biz of Bright Brothers Print E-mail
Written by Arjun   
Saturday, 15 September 2007
 MUMBAI: Sintex Industries, a leading player in the water storage business, has announced the acquisition of the automotive plastic division of Bright Brothers for Rs. 149 crore in an all cash deal.

 Sintex Industries Ltd will acquire the automotive plastics division of Bright Brothers Ltd through Bright Auto Plastic Private Limited, a downstream subsidiary of Sintex Industries Ltd.  Commenting on the acquisition, Mr. Amit Patel, Managing Director, Sintex Industries Ltd., said, “This acquisition represents a significant step towards us establishing a strong presence in the domestic plastic auto component market. Bright Brothers Ltd is a consistently performing high growth company, with a portfolio of established products that have tremendous potential, catering to leading OEMs in the domestic automobile segment. The acquisition which is earnings accretive will add strongly to Sintex’s consolidated topline as well as bottomline, due to commonly shared synergies. It would also enable us to gain access to new and credible customers in the automotive space and would qualify us as a reputed manufacturer and supplier of automotive plastics in addition to our existing non auto plastic components product suite.”
 
 Sintex will acquire the Company in the form of a slump sale purchase, for a transaction amount of approximately INR 1.49 billion. The slump sale includes purchase all 5 strategically located automotive component manufacturing plants in India.

 The newly formed entity will retain all 400 employees from the existing workforce of the automotive division. Importantly, the current Promoters of Bright Brothers Ltd will lend strategic support to Sintex subsequent to the transaction. Mr Suresh Bhojwani, Vice Chairman, Bright Brothers Ltd will take a position on the Board of Directors of Sintex’s acquiring entity post completion of transaction. Sintex will be the beneficiary of Mr Bhojwani’s experience in the plastic auto component business in India. Mr Bhojwani’s support will also ensure a smooth transition of the business.

 Increase in Product Portfolio & Market Reach Sintex, with the acquisition of the automotive business of Bright Brothers Limited would gain access to new and credible customers in the automotive space such as Maruti Udyog, Hyundai, Tata Motors and Mahindra & Mahindra. This would qualify it as a reputed manufacturer and supplier of automotive plastics.

 Bright Brothers manufactures a range of exterior and interior systems. These include amongst others front and rear bumper systems, green house systems, seating systems, acoustic management and cockpit systems.

 The operations are well developed to cater to a range of operations like injection molding, vacuum forming, ultra sonic welding, hot plate welding, spray painting, PU foaming and assembly operations. It also offers new product design and development, material and product testing, mold making, value engineering and prototyping services.

 The acquisition would enable Sintex gain access to manufacturing assets at all key auto hubs across the country, such as Chennai, Sohna, Pune, Pithampur and Nasik (covering the West, North and South). All sites are strategically located in close proximity to large automobile manufacturing locations in India.

 Mr. Suresh Bhojwani, Vice Chairman of Bright Brothers Ltd, and the founder of the Company will be on the Board of the newly formed entity, post completion of transaction in an advisory position. Other key members of the management team (CEO, Head – Business Development) would continue to manage operations and marketing, enabling smooth business continuity.

 Bright Brothers Ltd.’s critical strengths lie in its first mover advantage in India, product excellence and innovation and superior customer service. Over the years the company has evolved from a single manufacturing centre for plastic and injection moldings, to customer focused multiple manufacturing facilities. The growth drivers of Sintex currently are Composites and Prefabricated structures. This acquisition would increase the Company’s product mix and provide an impetus to Sintex’s existing Auto Components business.
 
 YES Bank Ltd was the exclusive strategic and financial advisor to Sintex Industries Ltd on the transaction. While Ambit Corporate Finance Pte Ltd. acted as the exclusive strategic and financial adviser to Bright Brothers Ltd.

 This transaction follows the recent USD 20.5 mn acquisition by Sintex of Wausaukee Composites Inc, USA, a manufacturer of highly engineered composite plastic components.
 
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