Tuesday, January 3, 2012

ULTRA Purchased by HERO

Hero, India’s biggest bike maker, brings itself at the centre stage of the global electric bike business with the take-over of its former Indian partner. On December 28 the Ludhiana based company announced the take-over of the London, UK headquartered Ultra Motor Ltd. “This acquisition provides us excess to Ultra Motor’s existing range, distribution network, designs and presence in hi-end markets,” said Naveen Munjal, Managing Director of Heroeco Vehicles Pvt Ltd.; Hero’s subsidiary that currently (among other activities) manufacturers and markets e-scooters. 

Hero in the past had purchased several old Malaguti models and re-manufactured them for the Indian market. The first full Italian designed scooter was the Malaguti Italy CENTRO 50cc model. Older plastic molds were transferred in the 90s to India and sold in huge quantities compared to the European market. Eventually Hero started making and designing its own models. Since the 1990s HERO has been on a buying spree, buying designs from Taiwanese and European firms gaining tech and designs.

On November 7 Ultra Motor Ltd. filed for Administration in the UK which is comparable to the Chapter 11 bankruptcy protection in the US. The company announced that it had sold its subsidiary Ultra Motor Taiwan to a group of European private equity investors. 

After selling its Taiwan subsidiary Ultra Motor Ltd. still owned two distributing companies located in the Germany and the United States. Next to that there are subsidiaries controlling the Ultra's E2W business, including the A2B range. “We took over everything including the team, stock, IT, tooling, brand & R&D,” Naveen Munjal said.

Ultra Motor has a main manufacturing plant in Taiwan and two contract assembly plants in China. The contract manufacturing in China willl be shifted to India in the next 6-8 months. Heroeco has about 1,300 workers in its Ludhiana plant while Ultra Motor’s 80 people would join as its global workforce.

Currently, Heroeco has presence in e-scooters only but with the Ultra Motor brand, it will widen its product range with e-bikes. “We will now have a wider product range from pedelecs, folding bikes, e-bikes and e-scooters,” Naveen Munjal furthered.

At the December 28 press conference chairman, Vijay Munjal of Heroeco Vehicles Pvt Ltd. announced next to the Ultra Motor take-over also the company’s entry in the medical equipment sector under the Mediva brandname as well as a new bicycle range under the Winn brandname. “Winn will be a hi-end bicycle range to be launched globally after entering the Indian market. We find the gaps in our international range of bicycles and Winn fills the gap,” Vijay Munjal said. The company’s Mangli plant in Ludhiana manufactures 900,000 bicycles annually for the international market and 65,000 e-scooters.

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