Mahindra & Mahindra Ltd announced the acquisition of a 75% stake in Hisarlar Makina Sanayi ve Ticaret Anonim Sirketi (Hisarlar), a tractor manufacturing company in Turkey for $19 million.
As per the transaction, which is expected to close by April 2017, Mahindra will acquire a 75.1% equity stake in Hisarlar. The association will help in growing the farm equipment business in Turkey and Europe.
The funds from M&M will be invested as fresh equity infusion into the company and the Indian company will have majority in the board including management control. The balance shareholding will be with European Bank for Reconstruction and Development (EBRD), 18.7%; and the founding Turker family, 6.2%. Further, as part of the transaction, Darby Converging Europe Fund III will exit.
Dr. Pawan Goenka, Managing Director, Mahindra & Mahindra Ltd. said: “Mahindra is the world’s No 1 tractor company by volume, with an on ground presence in India, U.S., China and Japan, besides many other export markets. 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.”
Rajesh Jejurikar, President and Chief Executive, Farm Equipment & Two Wheeler, M&M in a statement said, “Hisarlar is a market leader with 45% market share in soil preparation equipment in Turkey. 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.”
