Former General Motors Europe President Richard Donnelly has made his third deal as a buyer of auto parts firms.
Donnelly is an industrial partner at Ripplewood Holdings LLC of New York, which in late June bought majority ownership in publicly traded Asahi Tec of Shizuoka, Japan.
Asahi Tec posted sales last year of $400 million from its automotive castings business, including its ultralight die cast aluminum wheel business.
Its operations are limited to Japan and Thailand. About 75 percent of its sales are auto related.
The addition of Asahi Tec raises to $800 million the estimated annual sales for Ripplewood's auto parts group.
"This shows Ripplewood's continued confidence in the global auto industry, specifically using Japanese companies as a springboard for building global companies," says Donnelly, who spent 38 years with GM.
Private equity firms such as Ripplewood, which raise cash from pension funds, insurance companies and institutions, have continued to snap up smaller companies.
These financial firms are largely unencumbered by the heavy debts
the big strategic suppliers accumulated during the industry consolidation of the 1990s.
The strategy emerging from Ripplewood acquisitions indicates that Donnelly is building two global industrial platforms: automotive castings and auto switches, sensors and actuators.
Donnelly, 60, completed his first deal in 2001 when he acquired switch maker Niles Ltd. of Tokyo. That deal included Niles U.S.A. of Novi, Mich., as well as one plant in the United States.
Niles Ltd., where Donnelly is chairman, then closed on a deal in February to acquire switch maker Micro Craft Inc., also of Novi, and two plants.
Ripplewood hires industry experts such as Donnelly to find deals for its many platforms, including automotive retailing, specialty chemicals and auto parts.
Donnelly says he examines 50 companies annually for Ripplewood to acquire. He says two more acquisitions could be completed within a year.