M&M acquires UKs largest forging co Stokes for 12 m

Mumbai, Jan 4 | Updated: Jan 5 2006, 05:46am hrs
Mahindra & Mahindra Ltd, through its auto components division, Mahindra Systems and Technologies (MSAT), has acquired 98.6% stake in UK-based Stokes Group Ltd, the largest forging company in the UK, for around 12 million pounds.

Stokes Group has a forging capacity of 36,000 tonne with two manufacturing facilities in UK. The acquisition gives MSAT access to customers like Ford, Visteon, Koyo Bearings, GWK group, Land Rover, ZF and Bosch.

Stokes posted an annual sales of 25 million pounds for the year 2004. With the acquisition of Stokes, MSAT has doubled its forging capacity to 70,000 tonne.

The acquisition provides us with improved forging technology, better yields and proximity to customers, said Hemant Luthra, president, MSAT sector. This is MSATs second overseas acquisition after picking up stake in UK-based engineering services company Plexion Technologies recently.

MSAT acquired Amforge Ltd last year for a consideration of Rs 250 crore. Replying to a query on the high cost of labour in UK, Mr Luthra said, The high value high technology products would be made in UK. We would rationalise the product mix between our facilities in India and UK. We believe the Stokes acquisition demonstrates our commitment to build a world class business that serves its global customers and enhances value for M&Ms stakeholders, said Anand Mahindra, vice-chairman and managing director of M&M, according to a company statement. Khaitan & Co and Sherrards Solicitors, UK were the legal advisors for the deal to the company.