The group said on Thursday (10 October) that this would make it the third-largest manufacturer of vehicle batteries in eastern Europe and Russia‚ the Middle East and Africa.
It also meant the South African manufacturer had become a major producer of batteries for heavy vehicles‚ having previously focused on the passenger and light commercial vehicles.
This is the Metair's second big international acquisition in the past 15 months. It says the purchase will boost its exposure to high-growth markets and help capture growing share of the global "start-stop" battery market.
Metair says it has concluded a share purchase agreement to buy 100% of Mutlu Holding‚ giving it an effective 75% interest in Mutlu Aku‚ which is listed on the Istanbul stock exchange.
In addition‚ Metair will have a controlling interests in Plastik‚ Turker Izabe and Metropol. These companies provide support to the battery-manufacturing business.
"Turkey is the number one heavy vehicle and bus manufacturing destination in Europe‚" Metair's managing director Theo Loock said.
He said that there were about 18m cars and light commercial vehicles in Turkey‚ making it more than double the size of the vehicle park in South Africa.
The buyout was in line with Metair's strategy of deriving 50% of its business from OEMs‚ 50% of business from the after-market‚ and 50% of those combined businesses from batteries.
In August last year‚ the group bought a 99% stake in Rombat‚ the largest lead-acid battery manufacturer in Romania. At the time it said the R440m purchase gave it complementary technology platforms and access to Europe's vehicle markets.
Rombat's battery business was "similar" to Metair's First National Battery unit‚ but the Romanian manufacturer did not have "start-stop" battery technology‚ which allowed vehicles to switch off instead of idle when stopped‚ in line with European pollution laws.
The Rombat acquisition was to enable Metair to transfer 100% South African technologies‚ including non-automotive products‚ to Romania‚ while growing its after-market business.
These include battery back-up systems for nuclear and other power plants‚ and batteries for industrial equipment such as forklift trucks.
Loock said the Mutlu Aku transaction would enable Metair to capture a greater share of the anticipated growth in the market for start-stop batteries. It would also now be able to produce an annual 11.7m batteries of various types when combined with First National Battery and Rombat.
Coface‚ a France-based global credit assurer‚ said on Thursday (10 October) that motor industry demand worldwide was moving to emerging markets.
It said the industry was the world's sixth-largest in gross domestic product terms‚ with revenue of €2trn. China has become the leading global market with 19.3m vehicles sold annually.
In buying Mutlu Aku‚ Metair would have to make a mandatory offer to minority shareholders for the remaining 25% of the company. The transaction would be funded in equal parts with debt and equity. Absa Bank would provide the debt facilities.
Meanwhile Metair said it had already received "indicated commitments" from a number of non-banking institutions to subscribe under a private vendor placement for sufficient Metair shares to cover the equity-funded component of the purchase price.
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