Indian tractor and farm machinery manufacturer Mahindra & Mahindra (M&M) has acquired Turkish tractor maker Erkunt (Erkunt Traktor Sanayii) – the fourth largest tractor brand in Turkey.
The second Turkish business M&M has bought following the acquisition of Hisarlar earlier this year, Erkunt makes a wide range of tractors from 55-110hp under the ArmaTrac brand. 100% owned by the Armagan family, last year the Ankara-based firm sold around 4,700 units (6% market share) and generated a revenue of US$88 million. The acquisition also provides Mahindra with a foundry, which makes engine blocks, cylinder heads and transmission cases for a wide range of customers including JCB, MAN, Ford and Deutz. Commenting on the Erkunt acquisition, which is expected to close by the end of this year, M&M managing director Pawan Goenka said the firm’s strategy is to globalise aggressively and expand the portfolio to include various new ranges of tractors and farm machinery. “Turkey is a very important market in our globalisation journey, and the acquisition of Erkunt will enable Mahindra to expand its footprint in the world’s 4th largest tractor market.” Around 71,000 tractors were sold in Turkey last year (2009-2015 average 48,450 units), making it the fourth largest tractor market globally in terms of volume. Together with harvesters, implements and other farm machinery, the Turkish market is worth around US$3.5 billion a year.
Around 7% of Erkunt’s production is exported as the ArmaTrac brand, and the new owner sees possibilities to build the export business, particularly in the neighbouring markets of the Middle East, CIS and Europe.