German piston supplier Mahle acquired a majority share of BMW's camshaft production operation near Berlin.
Separately, Stuttgart-based Mahle also bought out a 25.8 percent stake that DaimlerChrysler had owned in Mahle's Valve Train Systems operations. DaimlerChrysler had taken the stake in compensation for selling to Mahle its engine-valve plant in Bad Homburg, Germany, in the mid-1990s.
Buying 51 percent of the BMW operation makes Mahle Europe's largest independent supplier of ready-to-install camshafts, the company said. The cost of buying the stake was not disclosed.
The camshaft plant in Spandau, a Berlin suburb, has 250 employees. Initially, Mahle will supply most of BMW's camshafts from the site. In the medium term, Mahle said it might build a second unit next to the existing facility to make camshafts for other Mahle customers.
Overall Mahle sales rose 9 percent last year to E3.1 billion. Mahle achieved the revenue gains from growing business in supplying systems and by consolidating operations of new acquisitions. Without the newly consolidated companies, sales would have been up 3.5 percent last year.
Outside Germany, Mahle consolidated new subsidiaries in Canada, Mexico, South Korea, India and Australia during 2002.
European profit margins were hampered by "very significant" price and cost pressures, said the company, but results improved in North and South America and Asia Pacific.
Mahle's main investments last year were a new piston casting plant in Poland, a new piston plant in Australia and the expansion of its connecting rod-production facilities in Mexico.
The company also built a new center for composite camshafts in Leibertingen, Germany.
If currency exchange rates are stable, Mahle expects its recent acquisitions to help sales grow 5 to 10 percent in 2003.