Carlyle to launch a $400M platform in India for EV auto component acquisitions

By Staff Report September 23, 2024 6:56 pm IST

Carlyle plans to establish a $400 million platform in India to acquire and merge auto component manufacturers.

Carlyle, a global private equity firm, plans to establish a $400 million platform in India to acquire and merge auto component manufacturers. The company aims to acquire at least two part-makers by the end of the current financial year and another two over the next 12–18 months, focussing on companies supporting electric vehicles (EVs) and strong export capabilities.

Carlyle plans to merge with mid-sized companies specialising in precision machining and forging EV components through roll-up mergers.

Carlyle is acquiring smaller investments in commercial vehicle component manufacturers to secure controlling stakes. Despite not finding suitable larger companies, Carlyle is acquiring smaller businesses for future integration, as seen with its recent acquisition of Worldpac, a leading North American automotive aftermarket parts supplier.

The company sees a big opportunity in India’s expanding domestic market and as an export hub in the auto component business. This is consistent with Carlyle’s overall investment approach, which it intends to repeat in other areas.

Carlyle has received $165 million in dividends from Hexaware Technologies, an IT services firm it acquired for $3 billion in 2021. The acquisition was financed through $1 billion in offshore debt, a strategy used by private equity firms to service debt and provide investor returns. SpiceJet has announced a settlement agreement with Carlyle Aviation, involving a $40.17 million write-off of lease arrears and the conversion of outstanding dues into equity in the airline, amid competition from Premji Invest and Mizuho.