New Delhi, Feb. 24 -- Bain Capital-backed wiring harness maker Dhoot Transmission Ltd, which recently filed draft papers for an initial public offering (IPO), is set to acquire FourFront Ltd, a manufacturer of customized components for large equipment makers. The financial terms of the transaction were not disclosed.
Dhoot said it will merge FourFront with its automotive electronics arm. "The combined platform brings together complementary product capabilities, manufacturing depth, and long-standing OEM (original equipment manufacturer) relationships to support the increasing electronics content and electrification requirements of the automotive industry," the company said in a press note.
FourFront had filed its draft red herring prospectus (DRHP) with the BSE in June last year for an SME IPO and received approval in August to issue about 6.5 million fresh shares at a face value of Rs 10 each.
Meanwhile, Dhoot plans to raise around $250 million (Rs 2,273 crore) through a mix of fresh issue and offer for sale, according to the VCCircle report published earlier this month.
"This partnership is closely aligned with our strategy of building a differentiated automotive platform with strong capabilities in electronics and electrical systems," said Rahul Dhoot, managing director of Dhoot.
Founded in 2007, FourFront is a tier-I supplier of customized electromechanical and electronic solutions to leading automotive OEMs, with a focus on EVs. It designs and manufactures switches, USB cables, onboard chargers, DC-DC converters, and power distribution units for both internal combustion engine and electric vehicles.
The company's revenue declined about 15% year-on-year in FY25 to Rs 109.7 crore from Rs 128.6 crore in FY24, according to VCCEdge, the data and research platform of VCCircle.
The fall was largely due to operational and market factors. The company is heavily dependent on the automotive sector, and a slowdown in the industry during the nine months ended December 2024 weighed on demand for its switches and power electronics products. The impact was exacerbated by high customer concentration, with a single OEM accounting for nearly 62% of revenue, as disclosed in the DRHP.
Dhoot's IPO plans come just over a year after Bain Capital acquired a 49% stake in the auto components maker to support its expansion and global growth strategy. Founded over two decades ago, the company supplies OEMs across the automotive and consumer durables sectors, and manufactures wiring harnesses, automotive switches, electronic sensors and controllers, connectors and terminals, automotive cables, power cords, and battery packs.
Separately, Bain Capital also invested in auto component and construction equipment maker RSB Transmissions in 2024.
Published by HT Digital Content Services with permission from VC Circle.