The Rs 176 crore acquisition, effected in a JV with Samvardhana Motherson Finance Ltd (SMFL), is in line with Sumi Motherson’s 2005 vision plan to achieve a turnover of Rs 10,000 crore by 2010 and will position the group as one of the world’s largest manufacturers of automotive exterior mirrors. The new company will be called Samvardhana Motherson Visiocorp Solution Ltd (SMVSL).

Visiocorp Group supplies exterior mirrors, interior mirrors and blind spot detection systems for all passenger vehicle segments and nearly every carmaker in North America, Europe, Asia and Australia.

Commenting on the acquisition, Vivek Chaand Sehgal, chairman, Sumi Motherson Group said, “MSSL had a highly successful JV with Visiocorp in India for the past 13 years. This acquisition will lead to significant leveraging of business synergies as our Group’s existing business greatly supplements Visiocorp’s needs for products and services, particularly in design engineering services, IT, injection moulded parts and assemblies, moulds and wiring harnesses.”

“The acquisition further elevates the Group’s positioning as a major Tier I supplier to the automotive industry with a combined global footprint spanning 20 countries and having 80 manufacturing units. It will also provide access to the Visiocorp’s diverse global customer list which includes BMW, GM, Ford, Hyundai, PSA Peugeot-Citroen, Renault/Nissan and Volkswagen,” said Vaaman Sehgal, CEO, Samvardhana Motherson Visiocorp Solution Ltd.

More acquisitions on the anvil

“We do not rule out further acquisitions in future. Our CAGR for the past eight years has been more than 40 percent. We have always set five-year goals and in 2010 we shall again set an ambitious target for 2015. In 2005 we had fixed our five-year target at Rs 10,000 crore and we are fairly close to it,” noted Vaaman Sehgal. Of Visiocorp’s 16 manufacturing facilities, the biggest is in Hungary and is the export hub for its European operations.

“Over 14 new car launches are planned from that facility this new fiscal and it is a key area for us. While the Hungarian plant caters to Europe, the Mexican unit caters to the US market. The company has a 25 percent market share globally, which means one of four cars will have our mirrors. We have two facilities in India — one in Noida and the other in Chennai — and a 45 percent of the Indian market,” he added.

Visiocorp’s European unit makes hi-tech mirrors; some with in-built cameras that detect blind spots go into Volvo vehicles. “We are also talking to our other customers for this product which has a distinct advantage over existing models that use radar technology. It is a step ahead — we plan to develop this technology and bring costs down so that it becomes more affordable to enable it to be used for all models rather than just high-end cars,” he said.