Bharat Fritz looks at acquisition in Europe

Bharat Fritz Werner Ltd (BFW), the Bangalore-based Rs 277-crore manufacturer of machine tools and components, is looking at an inorganic route to its growth. It is in talks with a few companies in Germany, Italy and France for a possible acquisition.

Said N N Upadhyay, director, BFW, "As a first step towards our global expansion, we recently incorporated our wholly-owned subsidiary in Germany and will start shipping our machines to the European markets. In the second stage, we wish to acquire a machine tool manufacturing company in Germany or Italy to expand our global business. There are a lot of companies available for acquisition in Europe. We have identified half-a-dozen firms and are holding talks with them."

He said the company expected to conclude a deal in the next six months. "Until we acquire a company, we would like to establish our foothold in major European markets by exporting our machines to our German subsidiary, Bharat Fritz Werner GmbH, which in turn will market them in Europe," Upadhyay told Business Standard.

The company hopes to cash in on the name, Fritz Werner, a German firm which earlier had a 45 per cent stake in BFW, to expand its business in Europe. BFW aims to export 30 per cent of its turnover in the next two years. This year, it is looking at a turnover of Rs 350 crore, up 26 per cent over last fiscal. During the present year, it plans to export 25 machines and double the number next fiscal.

BFW has also finalised the fourth phase of its expansion involving an investment of Rs 50 crore in Bangalore. It is acquiring 35 acres land through the Karnataka Industrial Areas Development Board at Dobbaspet near Tumkur to house its new manufacturing plant.

Here, the company will manufacture a wide range of critical components and machines required for the aerospace industry. Aerospace companies like Lockheed Martin and Boeing are in talks with BFW for components supply, he said. Last year, BFW invested Rs 80 crore in its Bangalore facility.

"We are supplying parts to the Hindustan Aeronautics Ltd (HAL) helicopter division in Bangalore, Kanpur and Koraput. HAL will be spending over Rs 30,000 crore in the next three years and we will make use of this opportunity," Upadhyay said.