You are here: Home » Companies » News
Business Standard

Bengal-based firm buys 100-year-old German company to expand global reach

RAIL.ONE has been selling railway sleepers across the globe and has 850 employees

Namrata Acharya  |  Kolkata 

Railways

It was back in 1894, that established a lumber rafting and trading business in Heilbronn, Germany. By 1920, the family-owned company was already supplying to (then known as Deutsche Reichsbahn), the German railway operator. Several innovations followed in the subsequent years, the company emerged as one of the important partners of in supplying high speed tracks. Meanwhile, the Mittelstand company (term used for typically a family-owned small and medium-sized manufacturing firm in Germany) had expanded footprints across the globe.

In 2006, the track system unit of Pfleiderer, with around 850 employees, was sold to and renamed

In 2013, in one of the first of its kind acquisitions, a lesser-known Indian firm from Siliguri in West Bengal, PCM Group, acquired As completes almost four years of acquisition, the odd marriage between a mid-sized Indian and a German company has turned out to be precedence for the much touted Mittelstand programme, aimed at collaboration between Indian and German small and mid-sized manufacturing units.

In fact, acquired a company which was almost double its size in terms of turnover. has a turnover of around Euro 145 million (about Rs 1,091 crore), while has an annual turnover of close to Rs 600 crore. Thus, the PMC Group has now a collective turnover of close to Rs 1,600 crore.

"We purchased at a price much lower than the revenue. The PE fund which owned did not want to run the company, and it was a good opportunity for us to expand our footprints," said says Nishant Mittal, member of the supervisory board at

In fact, back in 2007, when Saudi Arabia was inviting bids for setting railway network in the region, was a major competitor to While PCM set up two plants in the country, set up one.

"That time, in 2007, we never thought of acquiring as it was completely out of our reach," says Mittal.

By virtue of the acquisition, an Indian-promoted firm has now emerged as a major supplier (Q1 or highest quality standard supplier of concrete and turnout sleepers) to So far, the company has supplied close to 20 million concrete sleepers for the German railway network.

"One of the biggest challenges for us was to understand the synergies the cultural differences. In the beginning, there were a lot of anxieties in the German side about the acquisition," says Mittal.

Recently, underwent a restructuring, whereby German operations have been separated into a new entity, and a holding company, called Group, has been created for all the subsidiaries of the company. Prior to the acquisition, PCM Group's overseas operations were limited to Saudi Arabia, the UAE and Bangladesh. However, post the acquisition, it has footprints in Romania, Spain, South Korea, Hungary, Turkey, the United States, apart from Germany.

The re-shaping of the company's organization was a step towards facilitating future international growth and market concentration. The holding entity, which provides marketing, R&D, business development as well as strategy and group controlling, is helmed by Jochen Riepl and a supervisory board consisting of PCM family members.

In the next two to three years, is looking at an investment of around Euro 30 million, according to Mittal.

Some of the ongoing projects of the company include one in Aschaffenburg (Bavaria/Germany), where is setting up a new plant with a capacity of 600,000 sleepers per year. In the future, the new site in Aschaffenburg will be the logistic center for sleeper delivery in western Germany. In the Middle East, the company is delivering prestressed concrete main line sleepers for North South Project, which covers a length of 2,400 km. This apart, it is also pursuing large-scale projects in Scandinavia (up to 800 km of high-speed lines). This apart, the company is also engaged in a number of projects for

RECOMMENDED FOR YOU