Hero Cycles may acquire Atlas ops

NEW DELHI: Hero Cycles may properly be trying to scoop up the struggling operations of Atlas Cycles.
Atlas Cycles, one of many nation’s oldest cycle manufacturers, had lately shut its final manufacturing unit within the nation, citing lack of funds.
The state of affairs may quickly change with Hero Cycles, run by the Munjal household, growing curiosity within the enterprise. Pankaj Munjal, chairman of Hero Cycles – the nation’s largest cycle firm that has a 43% market share – has initiated talks with promoters of the Atlas model after the latter stopped manufacturing.
“Hero is aggressively wanting to buy manufacturers globally, and we’re a zero net-debt firm with cash reserves of over Rs 1,000 crore. If anybody desires to promote, we’re open… We want to purchase manufacturers,” Munjal advised TOI. Asked about Atlas, he mentioned, “We are looking at it. Nothing concrete has been firmed up as yet.”
Atlas, which began making losses since 2014, had shut its Sahibabad manufacturing unit on June 3, which mockingly additionally occurred to be the World Bicycle Day. The plant had began in 1989, and it was the final operational plant of Atlas Cycle with a month-to-month manufacturing of over two lakh bicycles.
Acquisitions should not new for Hero Cycles, that had bought the enterprise of FireFox Bikes in India in 2015 for an undisclosed quantity in an all-cash deal. In 2016, it had additionally bought 60% fairness in Sri Lanka’s bicycle producer BSH Ventures, inside months of buying a stake in UK-based Avocet Sports.
In January this 12 months, the corporate had acquired stake in German premium e-bike maker HNF Nicolai as a part of its transfer to have a higher say in international cycle markets.
Munjal mentioned Hero is witnessing a robust traction within the home market regardless of the robust financial state of affairs. “We are looking at a surge in commuter cycling category in states such as Bihar and Odisha where the migrant labour is returning. The demand remains highly robust for cycles meant for children or for lifestyle as many people are purchasing them.”
The firm has a worldwide manufacturing capability of six million bicycles (practically 5 million in India), which it’s increasing to 10 million by the primary quarter of subsequent 12 months by contemporary investments of round Rs 400 crore. Munjal mentioned he expects enterprise to develop internationally as there generally is a backlash towards Chinese corporations globally after coronavirus outbreak. “People all over world are looking to de-risk from China. They want another manufacturing source and hub. Hero can fit in there, and thus we are expanding.”
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