VallabhVidyanagar-based engineering firm Elecon Engineering Company Ltd has decided to acquire the Benzler-Radicon group of businesses from UK-based David Brown Gear Systems Group for 18.4 million pounds (approximately Rs 128.8 crore). Besides, Elecon's Mauritious-based subsidiary will also acquire David Brown Systems, Thailand for around 3 million pounds (around Rs 21 crore).
The company said in a statement to the Bombay Stock Exchange(BSE) that through its special purpose vehicles(SPVs) Elecon has executed sale and purchase agreements with the David Brown Group of companies. Elecon officials could not be reached for a comment.
Elecon Transmission International Ltd (Mauritious), a 100 per cent SPV of Elecon Engineering has entered into an agreement with David Brown Systems S.a.r.l to acquire 100 per cent share holding of David Brown Systems Sweden AB (the Benzlers business).
Similarly, Elecon UK Transmission Ltd, a wholly owned subsidiary of Elecon Transmission International Ltd has an agreement with David Brown Gear Systems Ltd to acquire the applied products division of the latter, called Radicon. And lastly, Elecon USA Transmission Ltd, a wholly owned subsidiary of Elecon UK Transmission Ltd, has executed a sale-purchase agreement with Cone Drive Operations Inc to acquire certain assets of the gear motor business of Cone Drive Inc, USA.
This apart, Power Build Transmission International Ltd, Mauritious, a Group company of Elecon Engineering has also entered into an agreement with David Brown Systems to acquire 100 per cent stakes of David Brown Systems (Thailand) Ltd. This would cost around 3 million pounds.
Elecon was scouting engineering firms in Western Europe and USA for acquisition since 2009 and was also in talks with few companies for the purpose. It had, however, delayed the acquisition plans in the wake of slowdown. The group is one of the leading players in power transmission products, material handling equipment and mining equipment.
The company caters to the needs of various sectors like steel, fertilizers, cement, coal, lignite and iron ore mines, sugar, power stations and port mechanization in India and abroad.
