September 1, 2006 -- Metaldyne Corp. has agreed to be acquired in a $1.2-billion takeover by Japan’s Asahi Tec, in a bid to form a new global manufacturer of engineered automotive components. Metaldyne manufactures parts of powertrain and chassis systems; Asahi Tec produces ductile-iron and aluminum castings for components supplied to automotive, truck, and construction equipment builders. It also produces aluminum automotive wheels.
The acquisition has been approved by directors of both firms, and they expect to complete the transaction this year.
Earlier this year Metaldyne sold its forging operations to the upstart FormTech L.L.C.
Metaldyne chairman, president, and CEO Tim Leuliette explained the move is driven by global manufacturing trends. "Our customers are expanding their operations globally, increasingly outsourcing higher, value-added manufacturing processes and developing strategies that address these changes.
“One of the most dramatic changes is where vehicles will be developed in the future,” Leuliette continued. “According to CSM Worldwide, by 2012, half of all vehicle development worldwide is expected to be done in the Asia Pacific region. Suppliers that will be successful and competitive in the future must be ready to rapidly respond to customers as they execute these changes."
With Metaldyne, Asahi Tec will gain a wider geographic base and product portfolio it describes as “highly-engineered, precision modules and components for powertrain and chassis.” Presently, the group is concentrated in Japan, with operations in Thailand and China.
Metaldyne’s operations are spread across North America, Europe, Korea, and China, and is expanding in India and Brazil.
"This acquisition will increase Asahi Tec's customer base, geographic footprint, and product portfolio," stated chairman Shoichiro Irimajiri. "We will be able to bring new products and services to market more rapidly and more efficiently thanks to the increased scale of Metaldyne's operations and a strong and widely recognized management team."