Cases

Merger and Acquisition Assistance for a European Boiler Manufacturer to Find a Suitable Sourcing Partner from India

Background and Challenge

The client is a major European (Euro 500 Mn) boiler manufacturer producing coil type, fire tube and water tube type of boilers. To be more cost competitive in its market (largely Europe), the client had decided to source boilers or the key components from India. They were looking for a formal long term partnership (JV, equity participation, capacity reservation etc.) with an Indian manufacturer for sourcing the boilers and/or outsourcing of detailed engineering.

Approach and Recommendations

UC built an exhaustive list of boiler and key component manufacturers in India ? using various sources like data from state boiler boards, manufacturers association etc. We developed the screening criterion - product range fit, quality fit, critical size fit and strategic fit and eliminated companies that did not fit the criterion.

After discussions with the client, we shortlisted few a companies for the detailed analysis. Then we conducted plant visits and face to face interviews with the key decision makers at the shortlisted companies to assess them on key parameters like willingness for alliance, capacity dynamics, quality of products and infrastructure, expansion plans, engineering skills etc.

Results

The client received recommendations on strategy that could be adopted to ally with potential Indian manufacturers ? prioritisation based on stand-alone attractiveness and ease of accessibility or best possible combinations, for example an integrated approach for all types of boilers or only fire tubes and water tubes etc. UC delivered detailed profiles of each of the potential sourcing partners in India.