M&M buys Turkish farm Equipment Co for Rs 129 crore
Mahindra & Mahindra (M&M) on Friday announced acquisition of Hisarlar Makina Sanayi ve Ticaret Anonim irketi (Hisarlar), a farm equipment company based in Turkey for $19 million (roughly Rs 129 crore).
As part of the deal, which is expected to close by April, M&M — a part of the $ 17.8 billion Mahindra Group — will acquire a 75.1% equity stake in Hisarlar. The balance share holding will be with European Bank for Reconstruction and Development (18.7%) and the founding Turker family (6.2%). Further, as part of the transaction, Darby Converging Europe Fund III will exit its investment.The association is expected to help Mahindra grow the farm equipment business in Turkey and Europe. Pawan Goenka, managing director, Mahindra & Mahindra, said “Our strategy going forward is to globalise aggressively and also expand our portfolio to include various new categories of farm machinery. This acquisition is an important milestone in our globalisation journey.”
The Mumbai-based firm will have majority in the board and control the management of Hisarlar, a key player in agriculture machinery industry, tractor cabins and components for off-highway machinery. “The acquisition of Hisarlar will enable Mahindra to expand its footprint in Turkey and Europe, making this entity a global manufacturing base for various farm implements and tractor cabins,” said Rajesh Jejurikar, president and chief executive, farm equipment and two-wheelers, M&M. Turkey is the fourth largest tractor market globally with annual sales of around 60,000 units. Hisarlar’s revenue in 2015 was 208 million Turkish lira, with exports constituting around 35% of sales
The company has two production facilities in western Turkey and employs about 820 people. It is a leader in soil preparation category of implements with a 45% market share in Turkey. It has strong brands in this segment, supported by a distribution network of 87 dealers across Turkey. Besides agriculture machinery, the company manufactures tractor cabins and industrial components.