Investment firm buys stake in motor giant Adient’s local business
Black-owned P Pather Capital hopes to conclude more deals with other original equipment manufacturers
Investment firm P Pather Capital has acquired a 30.87% interest in CRH-Africa Automotive in a deal that will boost the car-seat-frame assembler’s empowerment credentials.
P Pather Capital wants to use the transaction, valued at R111m, as a springboard for similar deals with other automotive original equipment manufacturers in SA, says CEO Kevin Pather.
CRH-Africa Automotive supplies metal seat structures and metal pressings for catalytic converters to the automotive industry.
CRH-Africa Automotive’s wholly owned subsidiary Adient Pasdec assembles more than 800,000 seat-frame assemblies for carmakers such as BMW, Nissan, Ford and Volkswagen SA, among other customers.
Pather said the deal was funded by the Industrial Development Corporation (IDC) .
He said the transaction would improve CRH-Africa Automotive’s empowerment credentials, which would have commercial benefits as its clients would also get better empowerment ratings.
CRH-Africa manufactures more than 40-million pressed, machined and fine blanked components per annum. A large portion of pressings are manufactured and sold to catalytic-converter assemblers who export globally from SA.
CRH-Africa, which has two manufacturing plants in Port Elizabeth and Johannesburg, exports directly to South America, the US, Russia, Korea and the EU.
The majority shareholder of CRH-Africa is Ireland-based Adient, the world’s largest auto-seat manufacturer, which has 238 manufacturing and assembly plants in 34 countries worldwide.
P Pather Capital’s expertise in the automotive-component manufacturing industry is through its shareholding in automotive-component manufacturers Pasdec Automotive Technologies SA and Pasdec Automotive Technologies Botswana.
Pather said P Pather Capital plans to grow further in the automotive sector. “We are definitely looking for more deals with the other [original equipment manufacturers]. We have the support of the IDC in that regard,” he said.
The deal could encourage other original equipment manufacturers to conclude empowerment deals, Pather said.