Auto parts maker Asahi Tec announced Friday it will buy U.S. rival Metaldyne Corp. for $1.2 billion.
Asahi Tec, based in Kikugawa, Shizuoka Prefecture, announced the decision to buy the Michigan-based auto parts company following a meeting of its board of directors, the company said in a statement.
The deal is the latest sign that Japanese auto parts makers are expanding their North American presence, as Japanese carmakers increase production to keep up with growing sales there.
“The transaction will enable Asahi Tec to further expand its global reach with Metaldyne’s significant operations and presence in North America, Europe, China and (South) Korea and growing business in India and Brazil,” the statement said.
News of the deal lifted Asahi Tec shares 21.79 percent to 313 yen Friday on the Tokyo Stock Exchange.
The maker of aluminum wheels and engine parts said it will provide details on the financing of the deal, which will involve a third-party placement of new shares.
Metaldyne officials were not immediately available for comment.
Asahi Tec, in which investment firm RHJ International, Inc. owns a 63 percent stake, posted group sales of 58 billion yen in fiscal 2005, which ended last March.
The maker of aluminum wheels and engine parts said Metaldyne’s principal shareholders are to subscribe to newly issued shares of Asahi Tec via a third-party allotment.
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