Samvardhana Motherson Group, an Indian automotive supplier, is acquiring a majority share in Peguform GmbH, one of Europe's largest plastics processors.
B"tzingen, Germany-based Peguform injection molds thermoplastic interior and exterior auto parts. The company announced the deal July 13.
According to reports, Samvardhana Motherson will acquire an 80 percent stake from Peguform's present owner, Wels, Austria-based Cross Industries AG.
Cross will retain 20 percent of the Peguform.
The deal will go through within three months, subject to European cartel office approval.
Peguform CEO Klaus Rinnerberger described the deal as “a strategic partnership that will further accelerate the growth of our company, especially in new international markets.”
Peguform reported 2010 sales of about 1.4 billion euros and forecasts sales of 1.7 billion euros ($2.4 billion) in 2011, making it one of Europe's leading plastics processors. It employs 7,000 at 16 plants in seven countries — Germany, Spain, Portugal, Slovakia, Brazil, Mexico and China.
Noida-based Samvardhana Motherson employs more than 40,000 and specializes in mirror and vehicle cabling systems at 90 plants in 23 countries.
Peguform has had a checkered history, with many owners since it was established as Badische Plastikwerke in 1959 and later renamed as Peguform-Werke in 1978. Its various earlier owners have included British American Tobacco plc, Pegulan AG and Kl"ckner-Werke AG.
Fraser, Mich.-based Venture Holdings Co. LLC acquired Peguform in 1999 for $475 million from Kl"ckner. In 2002 Peguform filed for insolvency; Venture protested the move but could not prevent it. Not long after that, Venture also filed for bankruptcy.
Supported financially by its automotive OEM customers, Peguform continued operations and investment in machinery while still insolvent.
New York investment firm Cerberus Capital Management acquired the thermoplastic molding operations in Germany, Spain, Mexico and Brazil from the insolvency administrator in 2005, then sold them to Polytec Holding AG in August 2008.
In 2009, Peguform became an independently operating company and its sales recovered to 1.1 billion euros ($1.5 billion). In August 2009, Polytec ran into financial difficulty during the global crisis and sold Peguform to Sarpedon Management Consulting, resulting in Cross becoming majority owner.
Peguform strengthened its position in lightweight automotive construction in October 2010 when it bought a 51 percent holding in Die Wethje GmbH, which makes carbon-fiber-reinforced composites for automotive applications.
In April 2011 Rinnerberger told the local newspaper Badische Zeitung: “We cannot stay where we are. We are too large for a niche supplier and too small for an important international player.”
However, Klaus Amman, chairman of the Peguform works council, said he disputes industry claims that auto suppliers must have sales of at least 3 billion euros ($4.3 billion) to be considered important, international players.
The newspaper reported at that time that Rinnerberger — who came to Peguform from Magna International Inc. — said there had been talks with Aurora, Ontario-based Magna.
According to Badische Zeitung, U.S. and French companies also had expressed interest in Peguform. Rinnerberger had projected that no decision on the sale would be made before Dec. 31, 2012 — the deadline for Sarpdeon officials to repay 110 million euros ($156 million) they had borrowed to purchase Peguform in 2008.