Leading auto component-maker Motherson Sumi Systems Ltd (MSSL) today said it will acquire an

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80 per cent stake in Germany's Peguform Group from Cross Industries AG for an undisclosed sum.

The acquisition will be carried out jointly with group firm Samvardhana Motherson Finance Ltd, the company said.

"At the meeting held on July 13, 2011, the board of directors of MSSL has in-principle approved the proposal to (jointly with Samvardhana Motherson Finance Limited) acquire 80 per cent of the shareholding of Peguform Group, Germany, from Cross Industries AG," it said.

Cross industries would continue to hold a 20 per cent shareholding, the statement added.

The acquisition would be carried out through a special purpose vehicle in which MSSL will hold 51 per cent and Samvardhana Motherson Finance Ltd will hold a 49 per cent share, it said.

This SPV would acquire 80 per cent of the shares of Peguform Group, while 20 per cent of the shares would remain with the existing shareholder, Cross Industries AG.

"This (the acquisition) would also include 50 per cent holding in Wethje Carbon Composite, which is a part of Cross Industries," it said.

These acquisitions are subject to regulatory and other approvals, as may be necessary in this regard.

Commenting on the acquisition, Samvardhana Motherson Group (SMG) Chairman and MSSL Vice-Chairman V C Sehgal said: "Apart from the synergies that SMG would bring to the acquired entity, the product range of Peguform complements our polymer product range in India. There are obvious synergies in terms of customers served which will further strengthen the position of the group as a global module supplier to automotive OEMs."

He said the deal would be closed by September-October.

"We will announce the value then only," he told reporters here, adding that the acquisition would be funded through debt, for which it has tied up with a consortium of Indian banks.

Peguform is a leading full service supplier of differentiated high quality interior and exterior products for the automotive and related industries. It is into the development, manufacture and distribution of bumper systems, plastic components for vehicle exteriors, vehicle cockpits, dashboards and vehicle interior trims.

Peguform has a strong presence in Europe, supplying to major premium German brands. Cross Industries AG is an Austrian industrial holding company with a strategic and operative focus on the automotive sector.

Sehgal said Peguform is expected to close this calendar year with revenue of 1.6 billion euros.

MSSL scrips were trading at Rs 235 apiece at noon on the BSE, down 1.82 per cent from their previous close.