ZF India Pvt Ltd and Japan-based Somic Ishikawa Inc. have finalized the transfer of full ownership of their Indian joint venture, Somic ZF Components Pvt Ltd, to Somic Ishikawa. The transaction ends a 32-year partnership between the two companies, with Somic ZF Components now becoming a wholly owned subsidiary of the Somic Group.
Established in 1993, the joint venture manufactures steering and suspension systems for the automotive industry. It operates three production facilities in Gurgaon, Gujarat, and Chennai, serving major automobile manufacturers including Maruti Suzuki, Toyota, Nissan, Hyundai, Tata Motors, Mahindra, GM, and Renault.
In FY2024, Somic ZF Components reported revenues of approximately INR 6.85 billion, with an operating margin of 9.5 percent. The company’s business is concentrated in the passenger vehicle segment, with Maruti Suzuki and JTEKT accounting for around 70 percent of total revenues. As of March 31, 2024, the company held cash reserves of about INR 930 million and carried no debt apart from lease liabilities.
Somic Ishikawa plans to expand its presence in India through this acquisition, leveraging the existing technology, customer relationships, and infrastructure of the joint venture. “We are deepening our commitment to India, a market that is important to our global growth strategy. We aim to enhance our product offerings and maintain customer satisfaction,” said Kaname Saito, Managing Director of Somic Ishikawa.
ZF Group stated that the divestment is part of its broader operational strategy. It will continue to support the business through licensing of technology and designs, ensuring continuity in product supply. The current management team at Somic ZF Components will remain in place following the ownership transition.
Somic ZF Components was originally a three-party joint venture, with the Sona Group exiting in 2012, leaving equal ownership between Somic Ishikawa and ZF Group before this transaction.
Somic Ishikawa Inc. is a Japan-based manufacturer specializing in automotive components, particularly steering and suspension systems. The company has a history of collaborations in international markets and plans to grow its presence in India through strategic investments.