Samvardhana Motherson’s Thrilling Acquisition Journey in Aerospace and Health & Medical Sectors!

Motherson Sumi Systems primarily focuses on manufacturing and selling components to automotive original equipment manufacturers (OEMs). 

The company has recently unveiled a series of acquisitions aimed at strengthening its non-automotive sectors, particularly in the aerospace, health, and medical businesses. The company, through its subsidiary, is set to acquire a 100% stake in the French company, SSCP Aero Topco SAS. In addition to this, the company’s board has approved the acquisition of a 73.05% stake in Irillic Pvt. and a 100% stake in Samvardhana Motherson Adsys Tech Ltd. from Motherson Auto Ltd., making the latter a wholly-owned subsidiary. 

“As part of Vision 2025, Motherson is increasing its focus on non-automotive businesses, built on the core strength and manufacturing DNA of Motherson,” noted Vivek Chaand Sehgal, Chairman of Motherson Group. These acquisitions are poised to act as catalysts for the health and medical business, providing access to global manufacturing and R&D capabilities and expanding its presence across Europe and India. 

Furthermore, Motherson’s aerospace division is strategically enhancing its capabilities to offer a broader range of services to aerospace Original Equipment Manufacturers (OEMs). Notably, the company has already completed four acquisitions in the aerospace business segment, including AD Industries, Cirma, and SMAST in 2023, and CIM Tools in 2022. These acquisitions cover diverse areas such as sheet metal, hydraulics, mechanical assemblies, composites, metal treatment capabilities, wiring harness solutions, and advanced system solutions. With eight facilities in France and nine across India and Africa, Motherson is strengthening its global presence. 

In the health and medical business, the focus is on diagnostic equipment, patient aid equipment, IT solutions, and services. The company’s greenfield plant in Chennai is nearing the start of production (SOP), and certification audits are underway. The recent acquisitions of AD Industries and Irillic Private Limited mark the initial steps in this segment, bringing essential capabilities in carbon composites for radiology products and strong R&D and engineering expertise, including patented technologies and real-time imaging systems for medical procedures. 

These acquisitions reflect Motherson’s commitment to diversification and expansion into non-automotive sectors, leveraging its core strengths and manufacturing expertise. 

On October 23, 2023, both the Sensex and Nifty registered significant declines, closing with losses of 1.26% and 1.35%, respectively. Furthermore, the shares of Samvardhana Motherson International Ltd slipped by 0.57%. The current market cap of the company is Rs 62,917.80 crore. 

Furthermore, the stock has witnessed significant buying activity, providing returns of more than 49% in just one year. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.