Richard Donnelly, who retired as president ofEurope in 1999 and at one time headed GM Powertrain, is Ripplewood’s point man in acquiring control of several suppliers, a seemingly unlikely strategy for an ambitious takeover outfit.
Donnelly outlined the firm’s tactics at a Management Briefing Seminars session on Thursday and elaborated on its plans in a Ward’s interview.
What makes Ripplewood’s approach unusual is that, so far, most of its supplier investments have been in Japan, where U.S. takeovers traditionally have been met with stiff resistance.
Donnelly concedes that meshing U.S. and Japanese business cultures hasn’t been easy –and some players on both sides of the Pacific have exited.
Big bucks are involved. Since its founding in 1995, Ripplewood has invested $4 billion in four funds that now are valued at $20 billion.
In Japan it has acquired Niles Co. Ltd., a manufacturer of switches and sensors, with $500 million in annual sales, and Asahi Tec Ltd., a castings manufacturer with $400 million in sales, Donnelly says.
The firm also has acquired Microcraft Inc., a Novi, MI, switch maker, which it folded into Niles. Donnelly serves as Niles chairman.
Donnelly joined Ripplewood in 2000 and since has made some 50 trips to Japan and 20 to Europe looking for investment opportunities.
“Right now we’re heavily involved in looking for acquisitions” that might fit with Niles, Asahi and Microcraft, he says. But finding the right companies is not easy. “For every 100 you look at, you might get two.”