Harita Seating Systems of TVS Group to merge with Minda Industries

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Chennai | Published: February 16, 2019 4:15:31 AM

harita, tvs groupThe transaction encompasses merger of HSSL into MIL, and Harita’s 51% holding in Harita Fehrer, a joint venture with Fehrer Automotive

TVS group company and largest auto seating systems manufacturer Harita Seating Systems (HSSL) has decided to merge with leading auto components maker Minda Industries, part of the Uno Minda group, through a composite scheme of arrangement. The board of directors of both the companies have approved the merger proposal.

As part of the merger, the exchange ratios, based on the recommendations of the joint valuation report by independent valuers, will be 152 fully paid equity shares of `2 each of MIL for every 100 fully paid up equity shares of `10 each held in HSSL or every 4 fully paid up 0.01% non-convertible redeemable preference shares of Rs 100 each at an issue price of `121.25 per non-convertible redeemable preference share of MIL with a yield of 7.5% per annum on the issued price, for every 1 fully paid equity share of Rs 10 held in HSSL, said a Harita Seating Systems press release here on Friday.

The transaction encompasses merger of HSSL into MIL, and Harita’s 51% holding in Harita Fehrer (a joint venture with Fehrer Automotive GmbH, Germany, a leading automotive seating manufacturer in the Europe and Germany).

H Lakshmanan, chairman, HSSL, said: “The merger of HSSL with MIL will generate additional value for our shareholders by providing access to diversified product mix so as to deliver significant near- and long-term growth. Thus, the decision to join forces with the Minda group, positions the business better than most to share in this huge growth opportunity, especially, as these are truly very interesting times.”

“I am confident, the merger, will offer immense opportunity to broaden the portfolios and invest in products that are most relevant to customers. It will help to leverage the collective heritage, innovation, track record, combined products and capabilities to meet and exceed the automotive sector and the customers’ evolving needs. MIL, will be the right partner to widen the customer base, bolster R&D capabilities and overall ensure future growth of the business.We are confident that the merger with MIL will thus, be ideal in supporting collective growth aspirations and making the business truly future ready,” Lakshmanan further said in the statement.

Minda sees synergies across products, technology, customers, sales channels and value accretive. “This merger is an important milestone for Uno Minda. This is the largest M&A transaction that the company has undertaken. Harita is a quality, focused, system driven organisation and we are sure that we will be able to take the business to the next level and create value for our shareholders,” said Nirmal K Minda, chairman and managing director, Uno Minda group in a statement.

Harita specialises in manufacturing and supply of safe, ergonomic and reliable driver seats and bus passenger seats. Harita seats are used in the automotive segments including commercial vehicles, tractors, off-road vehicles, buses. For Q3FY18 the company has reported a net profit of Rs 5.11 crore as compared to Rs 9.28 crore on a turnover of Rs 139 crore
(`136 crore).

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