Varroc Engineering has acquired the global lighting business of U.S.-based Visteon Corporation for a consideration of $72 million. Varroc is a leading automotive component supplier. In a statement, it said the new business entity would be called Varroc Lighting Systems, and would continue to be led by Jeff Stevenson.
Tarang Jain, Managing Director, Varroc Group, told The Hindu that the acquisition would be funded through a mix of internal accruals and debt.
“This acquisition makes us the largest Indian automotive lighting manufacturer and the only lighting technology supplier in India,” he said.
“Visteon’s global lighting business has already posted revenue of $531 million, and we are expecting to cross the $1 billion mark by the end of 2012-13 to become one of the top three automotive component players in India,” he said.
The company said Varroc Lighting Systems would comprise the manufacturing operations in Apodaca (Mexico), Novy Jicin and Rychvald (Czech Republic) and in Pune besides engineering centres and associated units in Europe, the U.S. and India. Post-acquisition, the group will have 31 manufacturing plants and four engineering facilities worldwide.
Varroc is also in negotiations to buy Visteon’s 50 per cent share in its China joint venture with a Taiwanese partner TYC, which would be part of a separate deal. Mr. Jain said, “We are still in negotiations, and expect the deal to close soon for around $20 million.”
On the future of the lighting business, Mr. Jain said, “We expect the revenues of our lighting business alone to cross $1 billion over the next five years. Visteon’s lighting business not only brings the jump in revenues but also exposes us to world-class technology, benefiting more than 100 patents owned by us.”
The Varroc Group has targeted a turnover of $4 billion by 2020 coming from its three business verticals catering to the automotive sector — polymers, electricals and metallics.
“We are looking at some targets in polymers and metallics,” Mr. Jain said.
