The deal is expected to close by the third quarter of this year. As part of the deal, Eaton will purchase Kirloskar's two engine valve manufacturing facilities based in Nashik and Ahmednagar in Maharashtra.
Shyam Kambeyanda, head-operations, Eaton India, said, "The acquisition is part of our global strategy to increase our foothold in the Asia-Pacific market. This will also help to strengthen our presence in the Indian market. Through this acquisition, we will be able to use our global resources to meet the needs of the domestic Indian market."
Kirloskar had set up the engine valve manufacturing plant in Ahmednagar last year with a capacity to manufacture 14 million units of engine valves annually. The company supplies to players such as Maruti, Eicher Motors, Tata Cummins, Mahindra and Mahindra, Tata Motors.
Eaton Corporation is a diversified industrial manufacturer with sales of $13 billion in 2007. It is a global leader in electrical systems and components for power quality, distribution and control, hydraulics components, systems and services for industrial and mobile equipment; hydraulics, fuel and pneumatic systems for commercial and military aircraft; intelligent truck drivetrain systems for safety and fuel economy, and automotive engine air management systems, powertrain solutions and specialty controls for performance, fuel economy and safety.
Kirloskar Oil Engines is a listed company on the Bombay Stock Exchange (BSE). Its shares closed 0.49 per cent lower at Rs 110.90 as against the previous day's close of Rs 111.45.
