Wipro Consumer buys Delhi switchgear firm for Rs 102 cr

INDIA INC HITS THE ACQUISITION TRAIL

Wipro Consumer Care has acquired Delhi-based North-West Switchgear Ltd for Rs 102.2 crore in an all-cash deal. Under the contract, North-West will be manufacturer for Wipro for the next five years with a no-compete clause.

Vineet Agrawal, president, Wipro Consumer Care and Lighting, said the company had acquired the North West brand and its plant and machinery at its factory in Faridabad.

This is the switch company's only factory in the country. Without opening new manufacturing outlets, Agrawal is confident of increasing the output of the current factory by 50-60 per cent.

Wipro has also taken over North West's home wiring division, Equilay, that had a turnover of Rs 1.5 crore last year. Wipro's revenue for 2005-06 was Rs 600.9 crore with a growth rate of 27 per cent. North-West reported a gross revenue of Rs 37.6 crore last year.

The modular switch market is expected to grow at 25-30 per annum and North-West is considered to be a premium brand in this market.

These switches have a strong presence in New Delhi, Punjab, Haryana, Ahmedabad, Maharashtra, Kolkata and Hyderabad. Agrawal said North-West has a "small export business to UAE and Nepal that Wipro would continue to support".

Agrawal said, "Electrical switches segment is absolutely synergetic to our current business mix of domestic lighting, commercial and institutional lighting and our newly started office modular furniture business."

He added that the same team selling electrical outlets, energy management controls and software houses would sell the North-West switches.

Agrawal also reassured that there would be a gradual transition of North-West's sales and marketing team of 47 to that of Wipro's.