Metaldyne Eyes Acquisition

Metaldyne Corp. of Plymouth, MI, will double its European business if it acquires VCST Industrie early this year as expected.

The two suppliers signed a letter of intent in September. A spokesman at VCST in Belgium says the due diligence process should conclude in early 2003.

Only 15%, or $210 million, of Metaldyne's $1.4 billion in revenues in 2002 will come from Europe. VCST is in the same business areas (engines, chassis and drivelines) and had revenues of $175 million last year, mostly in Europe.

Metaldyne is strong in making forgings, and VCST has expertise in machining. Metaldyne has a contract to provide a structural subassembly for a transmission in 2005, and by adding VCST's machining capability, Metaldyne will provide more of the value content in the module.

VCST also makes the gears inside the Ford 5-speed transmissions used in the Explorer and F-150, as well as gears for continuously variable transmissions made by Zahnradfabrik Friedrichshafen AG.