Amtek to shortlist bidders for German car parts maker Tekfor: Sources

Amtek receives eight first-round bids, valuing Tekfor at up to 520 million euros

Loss-making Indian car parts maker Amtek Auto is expected to shortlist bidders for its German division Tekfor as soon as next week, people close to the matter said, a year after starting what has been a lengthy sale process.

Amtek, which has switched advisors and is now working with Rothschild on the sale, has received eight first-round bids, valuing Tekfor at up to 520 million euros ($573 million), one of the sources said.

Seven of the bids came from car parts makers, including a state-owned Chinese firm, while one offer was made by a private equity group, the source said.

People familiar with the industry said they see Spain's CIE — part-owned by India's Mahindra Group — and Canada's Linamar as having strong chances of being shortlisted. It is not clear whether Japan's Musashi Seimitsu, which earlier this year bought rival Hay Group, has also made an offer.

"CIE is in a preliminary phase of analysis on the conditions for the purchase of certain assets of Amtek Auto, such as Tekfor," a spokesman for CIE said.

Amtek, Rothschild and the other bidders declined to comment or were not immediately available for comment.

Tekfor is expected to produce earnings before interest, taxes, depreciation and amortisation of about 80 million euros this year. But people close to some of the bidders said that it is unclear to them how much of that is sustainable.

Amtek is on a drive to cut debt and launched the sale of the maker of driveline components formerly known as Neumayer Tekfor, just two years after buying it out of insolvency.

Neumayer Tekfor was founded in 1942 and was involved in several mergers before being bought up by Barclays Private Equity, now Equistone, in 2005. It had two joint ventures with Amtek before going into administration in 2012.