Takeover tycoon scans the globe

01 December 2005

V Jagannathan reports on Sundram Fasteners' acquisition strategies.

When takeover tycoon Suresh Krishna of the $3-billion TVS group looks out of his seventh floor office window at Chennai's Auras Corporate Centre, it is not always to admire the view.

The chairman and managing director of Sundram Fasteners Limited often spends time contemplating markets beyond the shores – not only for fasteners, but also for forgings and fastener manufacturing among others. And of late it has increasingly been the latter. What started as a small nuts and bolts company in the '60s now ranks as one of the top fastener manufacturers in the world.

Recently the Rs1,037-crore turnover Sundram Fasteners announced its intention to acquire Peiner Umformtechnik GmbH of Germany, which manufactures large-diameter, cold-formed and hot-forged bolts and nuts for large trucks, windmills, heavy industrial, and construction equipments. Peiner's single plant with 300 employees has customers such as Mercedes Group, Volkswagon, Motoren Werke, John Deere and couple of tier-I auto ancillaries.

The German company is a wholly owned subsidiary of the Textron Deutschland Beteilingungs GmbH, which is part of the $1.9-billion revenue Textron Fastening Systems Inc. Textron Fastening Systems is a 100-per cent subsidiary of the $10-billion American conglomerate Textron Inc,) that manufactures aircrafts – Cessna, Bell Helicopter – fasteners, golf cars, turf maintenance vehicles, finance, pump, power transmission, engines and others.

Seated behind his paperless table, Krishna explains the recent acquisition, "Everybody knew that we are on the look out for good picks and this came to us."

Peiner is his second acquisition in Europe. In 2003 the company acquired the precision forging business of Dana Spicer Europe Ltd, UK, now known as Cramlington Precision Forge Limited, for Rs11.6 crore.