The TVS Group has announced the acquisition of Universal Components UK Ltd., Britain’s leading independent wholesale distributor of commercial vehicle parts and accessories. This is the second acquisition by the TVS Group in the UK after its successful buyout of Multipart Holdings in 2009. With these two acquisitions, the TVS Group turnover would cross INR 1,000 crores in the UK and would employ nearly 500 persons.
The TVS Group had already made acquisitions in the UK through TVS Logistics Services Ltd. in 2009 to acquire the capability in the logistics business. Post that acquisition, the distribution and services business had been looking at possible acquisitions to increase its relevance to its stake holders and also acquire new capabilities. In this regard, TVS Europe Distribution Ltd., a special purpose vehicle created in the UK, has purchased 90 per cent of Universal Components UK Ltd.
The acquisition of Universal Components will help TVS develop its presence in the commercial and light commercial vehicles spare parts range in other Asian markets, except India, as well as help acquire best practices in dealing with its customers (small retailers). It will also further improve its forecast and planning capabilities and deploy state-of-the-art IT systems in India and other countries like Sri Lanka and Bangladesh where the distribution of spare parts is currently undertaken.
Universal Components, headquartered in Sheffield, has 420 customers in the UK who are serviced through 650 distribution outlets. It sells parts worth approximately INR 200 crores and employs around 100 people selling both manufacturer-branded parts and its own range of UC branded parts. It currently has in excess of 12,000 part numbers and plans to double this number in the next three to five years.
Announcing the British firm acquisition at a press conference in Chennai, Mr. R. Dinesh of the TVS Group, said: “This acquisition will give increased scale and size to strengthen our relationship further with global suppliers, which will benefit both Universal Components and TVS. We will utilize Universal Components’ marketing expertise and best practices in our businesses in India and other Asian markets. It would also help us to have wider coverage of parts to distribute in the aftermarket.”
Said Mr. Richard Slee, TVS Europe CEO: “With Multipart (now renamed as TVS Supply Chain Solutions), we will be able to provide significant benefits to Universal Components on the supply chain and backend logistics. It will also help the company to become the market leader and grow its already close relationship with its customers.”
David Kernahan, Managing Director of Universal Components, observed: “We are delighted to be under TVS ownership. Together we can continue our growth pattern and become a larger player in the international and domestic CV sector. We look forward to TVS helping Universal Components further increase its range of supplier relationships and also bring in low-cost country sourcing.”
With this deal, Universal can leverage the sourcing strength of TVS for accelerated growth; while TVS compliments the sourcing efforts of Universal Components not only in the trailer range but also in the commercial vehicle range, which is one of the growth drivers identified by Universal Components in the UK and other parts of Europe.