The acquisition is a step towards Hero Electronix's goal of becoming an ₹7,000 crore global digital business.
Electronics design solutions provider Hero Electronix has acquired the India business of TES DST Holding Europe, an electronics design services company based in Germany.
The acquisition was made through Tessolve Semiconductor, a Bengaluru-based company that Hero Electronix bought back in April, according to several news reports. The acquisition will give Hero Electronix a "dedicated electronics design arm," called Tessolve Embedded Systems (TES), which "will focus on supporting the design and manufacture" of electronic products for global customers.
"The aim would be to offer the complete product development life cycle solution—from idea conceptualisation to product development and manufacturing in ODM model," said Hero Electronix founder and director Ujjwal Munjal, according to Live Mint. Munjal did not disclose the value of the acquisition.
By acquiring TES DST, Hero gets news clients including Lufthansa Technik, PGA-Astronics and GE Healthcare.
Munjal said the acquisition is a major step towards Hero Electronix's goal of becoming a $1 billion (₹6,756.76 crore) global digital business. Munjal, along with other group companies, is planning to shell out up to ₹1,200 crore for the expansion.
In particular, the company plans to strengthen its analogue chip design capabilities. Hero is looking at several other acquisitions, but Munjal said that would have to wait until 2017.
"We will increase focus on Europe and U.S. by setting up sales offices there," the executive said.
Formed in 2015, Hero Electronix was motorcycle maker Hero Group's first foray into the electronics and technology space. In 2015, the company acquired set-top box company Mybox Technologies, which posted ₹300 crore in revenue for 2015-16 fiscal year—something that Munjal wants to double in the current financial year.
“What is happening in electronics is largely coming up from large MNCs who are based out of countries such as Taiwan, China and Singapore. With IoT, the spread is getting bigger. The idea is to generate confidence in India and build such kind of products,” Munjal said.