Crompton Greaves Bids For Emerson Electric's Transformer Business
Crompton Greaves Limited has made a $400 Mn bid to acquire the transformer division of Emerson Electric Company.
Emerson Electric wants to exit the transformer business to focus on control automation, which is the mainstay for industrial automation business.
If the acquisition goes through, it will strengthen the Crompton Greaves' position in the US market.
Transaction Reference: BS
Emerson Electric is a US-based diversified global technology company with a $37.3 Bn market capitalisation.
Crompton Greaves, part of Avantha Group, designs, manufactures and markets electrical equipment, and products and services related to power generation, transmission and distribution.
The company operates in 4 business lines – Power Systems, Industrial Systems, Consumer Products and others.
The company has been on an acquisition spree for a while now. In June this year, it completed its new transformer manufacturing facility in Washington, Missouri, in the US, with an investment of $20 Mn.
In April, the company had acquired three units of Nelco Ltd for Rs 92 Cr. Prior to that, it had bought UK based Power Technology Solutions Ltd for about 30 Mn pounds.
Crompton Greaves acquired MSE Power System for $16 Mn in 2008.
Crompton had made a net profit of Rs 860 Cr in the financial year ended March. The company had Rs 500 Cr of debt on its books as on March 31 against equity of Rs 2,500 Cr. It also had Rs 669 Cr cash on its books.
The company has taken a line of credit for the acquisition from domestic banks.
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KVEZAR VIEW
| Date | Transaction | Type | Buyer | Size ($mn) |
|---|---|---|---|---|
| 02/08/10 | Emerson Electric ( Transformer Division) - Crompton Greaves | M&A | Crompton Greaves Limited | 400.00 |
| Date | Type | Buyer | Target | Size ($mn) | State |
|---|---|---|---|---|---|
| 07/02/12 | M&A | Piramal Healthcare Limited | Looking For | - | Planned |
| 07/02/12 | Private Equity | IDFC Private Equity | Regen Powertech Private Limited | 20.39 | Announced |
| 03/02/12 | M&A | ThyssenKrupp Elevator India Private Limited | Eros Elevators & Escalators Private Limited | - | Completed |
| 31/01/12 | M&A | Inox India Limited | Looking For | 20.00 | Planned |
Company |
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| Name | Promoters | Office | Competitor | Website |
|---|---|---|---|---|
| Crompton Greaves Limited | Solaris Holdings Limited Corella Investments Limited - Escrow A Lustre International Limited - Escrow A |
6th Floor,CG House, B Road,Worli. |
Larsen & Toubro Limited Havells India Limited Easun Reyrolle Limited ABB Limited |
www.cgglobal.com |
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