By acquiring Yachiyo's four-wheeler business, the leading Indian Tier 1 supplier gets a host of benefits including entry into the global sunroof business, access to Honda R&D and significant synergies with its existing operations.
04 Jul 2023 | 9112 Views | By Autocar Professional Bureau
Samvardhana Motherson International, a wholly owned subsidiary of SAMIL, has entered into an agreement to acquire 81% stake in Honda Motor Co subsidiary Yachiyo’s four-wheeler business housed under Yachiyo Industry Co Ltd.
Honda Motor currently owns a 50.4% stake in the listed Yachiyo, and the rest is owned by ...
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Samvardhana Motherson International, a wholly owned subsidiary of SAMIL, has entered into an agreement to acquire 81% stake in Honda Motor Co subsidiary Yachiyo’s four-wheeler business housed under Yachiyo Industry Co Ltd.
Honda Motor currently owns a 50.4% stake in the listed Yachiyo, and the rest is owned by the public. As a part of this transaction, Honda Motor will first buy out the entire public stake in Listed Yachiyo via a tender offer making listed Yachiyo a wholly owned subsidiary. Further, Yachiyo’s two-wheeler business will get transferred to Honda Motor. Subsequently, SAMIL will acquire 81% equity in remaining Yachiyo four-wheeler business, thereby forming an 81:19 joint venture with Honda Motor
Yachiyo is engaged in the production of automobile parts like sunroofs, fuel tanks and resin products. The acquisition will bring a number of benefits to Samvardhana Motherson including entry into the global sunroof business, global partnership with Honda Motor, access to strong R&D capabilities and experienced team, significant synergies with existing business and operations, an opportunity to enter into other segments with Honda Motor and also strengthening of the Group’s presence in Japan.
Yachiyo’s four-wheeler business employs around 3,200 employees at 13 manufacturing facilities and three R&D centres across eight countries including the USA, Brazil, Mexico, China, Japan, Thailand, Indonesia and India. In FY2023, this business had reported revenues of 824 million euros and EBITDA of 94 million.
Yachiyo: strategic supplier to Honda worldwide
As a worldwide strategic supplier to Honda Motor with a fully aligned footprint, Yachiyo 4W supports Honda Motor in substantially all of its sunroof and fuel tank requirements at each manufacturing location. The strong relationship has been forged on the back of decades of excelling on Honda Motor’s strict technical and quality expectations.
Aiming to tap global demand for sunroofs
Sunroof systems have high growth potential globally due to an increase in demand and are expected to see a surge in application across all car segments. Transition to Hybrid will continue to see the use of plastic fuel tanks. The trend of fuel cell powertrain is also aligned with Type-IV hydrogen storage tank under the advance stages of development.
With its experience of working alongside a global OEM like Honda Motor and coupled with its own technologically advanced R&D capabilities, Yachiyo 4W is well positioned to cater to evolving industry landscape and future mobility. Yachiyo 4W has developed multiple value-added next-generation products like lighter plastic tail gates and type-IV hydrogen storage tanks.
The close proximity to Honda Motor plants across the globe provides an opportunity to offer existing products of Motherson to Honda Motor globally.
After successful closure of this transaction, Motherson will become a partner of choice for Honda Motor. This transaction enables further diversification for Motherson in line with its 3CX10 strategy along with opportunities for the company to offer these products to other OEMs across the globe.
Commenting of the deal, Vivek Chaand Sehgal, Chairman, Motherson, said: "This acquisition is an important landmark for Motherson as we are honoured to be handpicked bby Honda-san for a global partnership. We will give our best to live up to the trust bestowed upon us by Honda-san. These new product segments are in line with our increasing content per car strategy as well as our customer-centric approach. We believe this business will be highly synergistic with Motherson’s existing portfolio as we see ample opportunities to grow this new business globally by leveraging our global relationships with automotive OEMs. We are looking forward to the exciting times ahead.”
Yachiyo India Manufacturing, a key supplier to Honda Cars India, is set to localise the single-pane sunroof setup on the Honda Elevate midsize SUV.
Yachiyo's Indian arm, Yachiyo India Manufacturing, is a key supplier to Honda Cars India (HCIL). The Japanese sunroof supplier is set to localise the single-pane sunroof setup on the Japanese OEM’s Elevate midsize SUV, for which bookings opened yesterday in India.
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