Canadian supplier Magna International Inc. is trying to buy its way into the No. 3 position in seating in Europe.
Earlier in May Magna announced the purchase of Tricom Group Holdings Ltd., a British supplier of seats to Ford Motor Co., General Motors and BMW's Rover Group. The $51.8 million purchase price gives Magna a supplier in the UK with annual revenues of approximately $100 million.
'This is our first strategic move into Europe,' said Graham Orr, Magna's executive president of corporate development. 'We have other initiatives under way for additional acquisitions, as well as greenfield initiatives.
'This is the beginning of our expansion into the seating business there,' Orr said.
Magna is based in Markham, Ontario.
Orr said that Magna holds the No. 3 market position in US seating, with sales of about $1 billion. He said the company wants to grow to the same position in Europe.
'We want to be a major Tier 1 supplier in each of our businesses,' Orr said. 'By that we mean being among the top three or four system suppliers in each core business.'
Lear Corp. and Johnson Controls Inc. are the biggest global seating companies. They dominate the US market.
Magna was No. 26 on the Automotive News Europe 1996 list of top global suppliers of original equipment.
Last year Magna had worldwide sales of $4.8 billion, with $3.9 billion in the US.
Orr said Magna, like its major competitors, would like to buy the completed-seat unit of German supplier Keiper Recaro GmbH & Co. That operation has European sales of about $1.5 billion. Magna and Keiper Recaro have a joint venture in the US.
Orr said Magna is also in talks with other European seatmakers.
Magna's interiors operations have grown rapidly in the past year through acquisitions in Europe and the US. Last year, Magna bought US seatmaker Douglas & Lomason for $135 million. That deal gave Magna additional annual revenues of about $560 million. Last year Magna also acquired UK instrument panel maker Marley plc.
This year, Magna acquired German sound insulation supplier Georg Naher GmbH for $31 million.