New Delhi: Tata Technologies Ltd, a subsidiary of India's largest commercial vehicle maker Tata Motors Ltd, has agreed to buy the United States-based engineering services firm Cambric Corp for $32.5 million.
The company, a leading global provider of engineering services and manufacturing enterprise IT, has signed definitive pacts with Cambric, which will provide it access to high-end, systems engineering, engine design and powertrain engineering capability, Tata Technologies said in a statement on Friday.
"Cambric gives our customers in the Construction and Heavy Equipment as well as in the Automotive sector access to specialists in this field as well as an access to Cambric's powertrain expertise," Patrick McGoldrick, managing director and chief executive officer, Tata Technologies, said.
Under the pact, $30 million will be paid upfront, while the balance will be paid on Cambric's management meeting certain goals, Samrat Gupta, chief financial officer, Tata Technologies, said.
The Indian firm will borrow $20 million but the debt liability will be on Cambric's books, Gupta added.
Though Tata Technologies had cash balance of $133 million as of Dec 31, 2012, it decided to raise debt because borrowing rates are lower in comparison to earning on its cash, he said.
Cambric was advised by Rothschild and Holland & Hart LLP.