December 02, 2008

M&M set to buy Belgian gear maker VCST for EUR 300 million

ET reported that auto major Mahindra & Mahindra is in an advanced stage of negotiation to acquire Belgium gear maker VCST for EUR 300 million.

VCST, which designs and manufactures gears, gear sets and shafts for automotive engines and brakes already, has a presence in India. It formed a 50:50 JV with Amtek Auto. It employs around 1,000 people and operates 5 manufacturing facilities in 3 locations of Sint Truiden in Belgium, Reichenbach in Germany and Detroit in Michigan.

If the sale goes through, this would be the fourth time in seven years that VCST has been sold. It was earlier sold by San Francisco based private equity firm Fox Paine to Alpha Fund and the management for EUR 250 million at the end of 2005.