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Blackstone in talks to acquire stake of USD 300 million in Sona BLW

Published Date | 2018 November 23

The private equity firm of America, Blackstone is planning to merge its recently acquired firm of auto components name Comstar Automotive with Sona BLW after acquiring its stake. This is expected to boost the auto parts industry and automotive industry as well.
India: Blackstone is in talking terms to acquire stakes in Sona BLW Precision Forgings, the auto parts maker in India. Blackstone will be taking over the entire 32% stake that is held by JM Financials for around USD 300 million. Blackstone, which is an American equity firm, will be merging their recently acquired auto components firm Comstar Automotive with Sona BLW. Sunjay Kapur and family, who is the promoter of Sona BLW, will still be holding 68% share in the company. This merger is estimated to highly boost the auto parts market and the automotive industry. Blackstone is aiming to scale up their business in the auto parts sector by the merger of Comstar Automotive and Sona BLW. Earlier this year, in the month of April, Blackstone acquired almost 100% of the stake in Comstar Automotive Technology for around INR 1000 crore. According to one of the officials, “Blackstone is expected to get the entire stake held by JM Finance. The deal is currently at the competition commission of India for clearance.” Once the clearance is done, Blackstone will be approaching CCI to get approval regarding the merger of Sona BLW business and Comstar. According to BlueWeave Consulting, Blackstone is aiming to escalate and expand its exposure in the auto component arena with this acquisition. The PE firm has been among the prominent investors in automotive sector. Sona BLW, on the other hand, is a leading producer of precision forged (net shaped) bevel gears, synchronizer rings along with differential case assemblies and has plants in Pune and Gurgaon. The acquired auto components firm Constar Automotive is based in Chennai and mostly manufactures starter motors along with starter motor kits and alternators for various automotive applications. Thus, with the merger of Comstar and Sona BLW, Blackstone will be able to manufacture greater number and variety of auto parts which will increase not just their production capacity and revenue but also their footprint in the auto parts sector. According to the recently published report by BlueWeave Consulting,  on “Global Electric Vehicle Charging Station Market, By Product Type, By Installation Type, By Suppliers Type, By Region- Industry Analysis, Size, Share, Growth, Trends & forecast by 2018-2025”, The growth is attributed to an increased deployment of charging stations at public places such as shopping malls, commercial buildings, airports, and restaurants. The convenience of being able to use an EV charger while shopping or during office hours is expected to boost the adoption of electric vehicles. Furthermore, government offerings, such as tax credits, on the installation of publicly accessible stations are expected to boost the market. According to the report by BlueWeave Consulting on “Global Auto Parts Manufacturing Market, By Component, By Sales Channel, By Vehicle Type, By Region- Industry Analysis, Size, Share, Growth, Trends & forecast by 2018-2025”, the market for auto parts is growing significantly with an escalating CAGR during the forecast period. Growing demand for high-density batteries, production of brake pads which have reduced copper and heavy metals, coupled with rising inclination towards technologically driven products and growing automotive production is driving the growth of the market.