If you talk about numbers, Hero is not only smashing records in motorcycle and scooter segment, but also in bicycles. The world's largest bicycle manufacturer has gone a step ahead to ensure that the spot doesn't go anywhere for the years to come. Mifa, which is Germany's biggest bicycle manufacturer, has sold its 60% stake to Hero Cycles. It is still unknown that how much money Hero is shelling to acquire this German cycle manufacturer, but Hero has invested almo'st Rs. 160 crores through its subsidiary OPM Global.
"It's a strategic buy that would lead to huge amount of synergies in the global cycle business. The new combination of technology and cost leadership would help Hero to become one of the largest cycle companies in the world, both in value and volume," said Mr. Pankaj Munjal, Co-chair and Managing Director, Hero Cycles.
This is also a good news not only for Hero but also for Mifa despite doing well and with sales exceeding 100 million euros annually. The German giant is under debt it had taken to invest in new technologies and to produce high-end bicycles. "We are looking at a turnaround of this new company in the next 18 months. We would be putting up the plan devised by a global consultancy firm for changing the fortunes of Mifa. The supervisory board would also be reorganised in due course to bring some desired changes with some Indian participation," Mr. Munjal added.
Hero Cycles exports to almost 90 international markets including markets in Middle East, Africa, Asia and Europe. Mifa on the other hand has a very good base in the European market where it sells almost 5 lakh units annually.