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| M&M gets into Aerospace, acquires two Aussie firms |
| BS Reporter / Mumbai Dec 16, 2009, 00:22 IST |
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This will enable the firm to tap the defence offset market.
Automobile major Mahindra & Mahindra (M&M) has forayed into the aerospace business by acquiring majority stakes in two Australian companies, Aerostaff Australia and Gippsland Aeronautics.
Mahindra Aerospace Pvt Ltd (MAPL), in which Kotak Private Equity has also invested Rs 150 crore, will hold 75 per cent stake in each of the two Aussie companies. The remaining will be held by the existing managements. The payments will be made in instalments.
Anand Mahindra, vice-chairman and managing director of the Mahindra Group, said, “M&M’s move into the aerospace segment is supported by a renewed demand for economical air transport around the world. Our investment in component capability addresses the growing needs of both civic and defence markets."
Aerostaff Australia (AA) is a component manufacturer of high-precision, close-tolerance, aircraft components and assemblies for large aerospace original equipment manufacturers. AA’s acquisition will help M&M tap the burgeoning defence offset and commercial aviation market.
Gippslan Aeronautics (GA) is an established brand in general aviation and has delivered 200 FAR-23 certified planes in 32 countries (FAR 23 is a mandatory certification for fare-paying passenger carriage). Acquiring stake in GA signals M&M’s entry into the 2-20 seater, turboprop market, among the fastest growing segments in general aviation.
M&M will retain the management of both companies. The auto major is setting up a plant in Bangalore to provide dual-shoring cost benefits to customers.
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