Mahindra & Mahindra, the Rs 18,000 crore auto major, plans to buy Lokesh Machines Ltd, India’s biggest engine-block manufacturer.M&M has approached the management of the Hyderabad-based company with an offer to acquire over 51% equity.
Buying Lokesh, which had a turnover of Rs 113 crore last fiscal, will give M&M an assured and captive supply of cylinder blocks and engine heads for jeeps, tractors and the Scorpio utility vehicle.Lokesh supplies about 2.3 lakh engine blocks for M&M’s vehicles, which constitutes 35% of its business.For M&M, the move would be in line with the sales target set for Systech, its aggressively expanding auto component division — of $1 billion by 2010, or a 33% increase over current revenues.
Read more in The DNA Money article.
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