Harita Seating acquires leading foam company

Harita Seating Systems Ltd, the Hosur-based manufacturer of seats for two-wheelers, commercial vehicles, buses and tractors and a TVS Group company, has acquired Bangalore-based Polyflex India, one of the largest manufacturers of cold cure moulded polyurethane foam.

Without divulging the amount of investment, H Lakshmanan, chairman, Harita Seating Systems said, “This acquisition includes Polyflex’s manufacturing plants in Chennai and Bangalore, the movable assets of Polyflex’s Pune plant and its fabrication unit, Polyflex Engineering.”

Polyflex manufactures polyurethane products such as foam, seat frames and rods and plastic injection moulding products like seat base and shields. The company, which began operations in 1983, has three plants – one each in Bangalore, Chennai and Pune – which operate at 80 percent capacity utilisation. The Group has four divisions: polyurethane foam, engineering, plastic injection moulding and seating.

Polyflex's engineering division is primarily engaged in manufacturing and supplying automotive seat frames. The plastic business has a 600-tonne capacity machine and is a Tier II supplier. The domestic market accounts for the company’s total revenue which comes from supply to OEMs like Hyundai Motors, Hanil Lear, Araco Automotive and Ashok Leyland. Polyflex has a technical collaboration with Franz Kiel GmbH, Germany, one of the leading manufacturers of passenger seats for the bus and railway transport systems in Europe. Its 720-strong team of employees produce more than 450,000 seats a year for all the major bus manufacturers like Mercedes-Benz, MAN, Neoplan, Volvo and BOVA.

After entering into technical collaboration with the German company, Polyflex started commercial production in 2005. The seating division caters to the bus passenger and train segments. It also manufactures driver seats for commercial vehicles.

Strategic acquisition

When queried about the strategy behind the acquisition, Lakshmanan said, “It is to gain entry into the passenger car segment through Tier 1 companies. Polyflex supplies polyurethane foam for seats to Tata Johnson in Pune and Chennai, and Dymos India (formerly known as Hanil Lear) in Chennai. It is also a Tier II supplier to Tata Motors, Ford and Hyundai. We will continue to be a Tier II supplier for the passenger car segment fully supporting the existing customers of Polyflex.”

He added, “Once the Polyflex acquisition process is completed, most of it will come under Harita-Fehrer, which is a 51:49 joint venture that Harita Seating is establishing with F S Fehrer Automotive GmbH of Germany. Fehrer is well represented in passenger car seats manufacturing in Europe as a Tier II supplier. Harita-Fehrer will also manufacture two-wheeler seats, micro cellular urethanes, polyurethane composites, foaming for driver seats and passenger seats for buses. We will not be retaining the Polyflex brand name.”

Other than Hosur, Harita Seating has manufacturing units in Ranjangaon near Pune and Nalagarh in Himachal Pradesh. The company was established in 1986 as a joint venture with Grammer AG of Germany; the joint venture was terminated in 2002 and renamed Harita Seating Systems. The company has recorded sales of Rs 114.45 crore during the first half of 2008-09 as against Rs 82.91 crore in the corresponding period in 2007-08, registering a growth of 38 percent.