NEWS

Amtek Auto plans to venture into aerospace, railways, oil & gas

Thursday, Nov 13, 2014

Amtek Auto, a diversified New Delhibased auto component manufacturer, plans to diversify into new areas such as aerospace, railways and oil and gas by utilising its core forging and casting business, a top executive said. The $2.7-billion Amtek Group will continue to maintain its main focus on the automotive industry, but is looking at synergies with other areas to harness growth potential. "These are some new sectors identified by us for future growth," Amtek Auto senior managing director John Flintham told ET.

The group manages 65 production facilities across several countries. The casting and forging facilities for manufacturing automobile parts can also be used for making custom fittings, valve bodies and other components used in the oil industry. "With the successful acquisition of Jamshedpurbased (component maker) JMT Auto, we have managed to more than double our customer base in the oil and gas sector that has given us the confidence to explore this industry as future growth area," Flintham said.

Amtek had in 2008 formed an equally owned joint venture with American Railcar Industries to manufacture railway wagons. With the exit of the partner, it has now converted the venture into a fullyowned unit. The company said it has bagged some orders for cargo wagons from the government in recent months, though the revenue is miniscule from this new company.

Global investment firm Kohlberg Kravis Roberts (KKR) has recently agreed to offer a credit of 235 million (about Rs 1,800 crore) to the group's Singapore subsidy Amtek Global Technologies to retire part of the group's debt and fund expansion. The arrangement, the Amtek Group says, would allow it to consolidate its entire debt into a single source, KKR. The group currently has net debt of Rs 15,000 crore.

 

Source:http://economictimes.indiatimes.com/