Motherson Sumi Systems Limited, the flagship company of Samvardhana Motherson Group, has agreed to acquire Reydel Automotive Group, a portfolio company of Cerberus Capital Management LP. The purchase price is $201 million. Evercore was financial adviser to Cerberus and Reydel on the deal with Linklaters LLP providing legal advice. Reydel is a developer and supplier of interior components for automotive manufacturers.
Noida (India), 2 April 2018: Motherson Sumi Systems Limited (MSSL), flagship company of the Samvardhana Motherson Group (SMG), through its step down subsidiary Samvardhana Motherson Automotive Systems Group B.V. (SMRP BV), today announced the proposed acquisition of Reydel Automotive Group (Reydel), a privately held portfolio company of Cerberus Capital Management, L.P. (Cerberus) that manufactures interior components and modules for global automotive customers. The purchase price for the transaction is USD 201 million.
This would be the 21st acquisition from the Samvardhana Motherson Group and is intended to further bolster Motherson’s offerings in the automotive Interiors space. Reydel’s Interiors Product Portfolio includes Instrument Panels, Door Panels, Console Modules, Decorative Parts and Cockpit Modules. Reydel’s global presence spans 20 plants and 16 countries, and is supported by a workforce of approximately 5,650 associates. The acquisition would enable both companies to capitalise on new opportunities in their existing and new geographies, as well as within each others’ customer portfolios. Reydel’s revenue for the year ended Dec 31, 2017 was USD 1,048 million and EBITDA was USD 68 million (provisional, and in accordance with US GAAP).
“With world class development capabilities and strong customer relationships, we found great alignment with our existing offerings at Motherson,” said Mr. Vivek Chaand Sehgal, Chairman, Samvardhana Motherson Group. “The synergistic combination of complimentary portfolios will create a stronger business. We are very excited about this partnership. It brings us closer to meeting our 2020 targets and helps us achieve ‘3CX 15’, our strategy to not have any component, customer or country contributing more than 15% to our business.”
“We are proud to have contributed to Reydel’s significant accomplishments in recent years,” said Dev Kapadia, Senior Managing Director of Cerberus and Co-Chair of the Cerberus Private Equity Investment Committee. “Following a successful carveout from Visteon, we partnered with the business to develop a high-performing and focused management team that was able to vastly improve financial performance.
Since our acquisition in 2014, Reydel’s EBITDA has transformed from USD (16) million in 2013 to USD 68 million in 2017. Samvardhana Motherson Group is a world class company, and this transaction would fulfill one of our key objectives, which is to position the business with a leading entity that will take Reydel to an even higher level of performance and success.”
Benoit Rolland, CEO of Reydel, said, “The Cerberus team has been a great partner for Reydel during our efforts to improve our profitability and carve-out the business. We look forward to joining the Samvardhana Motherson Group, and this transaction would ensure that we will have excellent opportunities as part of one of the world’s leading suppliers to the automotive industry.”
The transaction will be discussed with employee representatives and, subject to obtaining customary regulatory and other approvals, could close within the next four to six months.
The consideration is expected to be financed using existing cash and banking limits at SMRPBV.
Evercore acted as exclusive financial advisor to Cerberus and Reydel, and Linklaters LLP acted as legal advisor. Latham & Watkins acted as legal advisor to Motherson for the transaction and Norton Rose as legal advisor to Motherson for Anti-trust related matters.
About Reydel Automotive Group
Reydel Automotive Group is a leading global developer and supplier of interior components to the global automotive manufacturers. Reydel’s Interiors Product Portfolio includes Instrument Panels, Door Panels, Console Modules, Decorative Parts and Cockpit Modules. Reydel’s global presence spans across 20 plants and 16 countries and is supported by a workforce of approximately 5,650 associates.
About Samvardhana Motherson Automotive Systems Group BV (SMRP BV)
Samvardhana Motherson Automotive Systems Group BV (SMRPBV) is a step down subsidiary of Motherson Sumi Systems Limited (MSSL), the flagship company of SMG and Samvardhana Motherson International Limited (SAMIL), the principal holding company of SMG through their subsidiaries.
SMRPBV has long-term relationships with a majority of the global OEMs. SMRPBV is present in each major global automotive production region, with 48 production facilities spread among 18 countries. SMRPBV operations include supplies to the global automotive industry as a Tier 1 supplier through its subsidiaries SamvardhanaMotherson Reflectec (SMR) and Samvardhana Motherson Peguform (SMP).
About Motherson Sumi Systems Limited
Motherson Sumi Systems Limited (MSSL) is one of the world’s leading, specialized automotive component manufacturing companies for OEMs. MSSL was established in 1986 as a joint venture with Sumitomo Wiring Systems and was listed in 1993 on the BSE and NSE in India. MSSL is a focused, dynamic and progressive company providing customers with innovative and value-added products, services and solutions.
With a diverse global customer base of nearly all leading automobile manufacturers globally, the company has a presence in 36 countries across six continents. MSSL is currently the largest auto ancillary in India and among the Fab 50 companies of India by Forbes magazine. MSSL is the flagship company of the Samvardhana Motherson Group (SMG), which is ranked 26th among global automotive suppliers by Automotive News. (CIN – L34300MH1986PLC284510)
About Cerberus Capital Management, L.P.
Established in 1992, Cerberus Capital Management, L.P. is a global leader in alternative investing with more than US $34 billion under management across complementary private equity, credit, and real estate strategies. From its headquarters in New York City and network of affiliate and advisory offices in the U.S., Europe, and Asia, Cerberus has the on-the-ground presence to invest in multiple asset classes globally.