Tube Investments of India, part of the $3.14 billion Murugappa Group, has bought controlling stake in France-based 37 million euros Sedis Group, a leading manufacturer of industrial and engineering chains, for 6.8 million euros.
This move is expected to help Tube Investments create its base in the European market. Besides, the acquisition will also enable Tube Investments access superior technology of Sedis for manufacture of special and engineering class chains and make products that are today being imported into India. Sedis Group has been associated with the Murugappa Group for last nine years.
Tube Investments has acquired 77 per cent of equity of Sedis Group’s holding company, Financiere C10. TII acquired this shareholding directly from the financial investors in FC 10 (75 per cent) and a few other shareholders. The management shareholders will continue to hold the remaining shares in FC 10 and be associated with Sedis for a period of three years, according to a company statement.
The turnover of Sedis Group was 37 millions euros and the profit after tax was 1.35 million euros for the year 2008. During the first nine months of calendar year 2009, the revenue stood at 21 million euros and the profit after tax was 0.55 million euros. “Sedis” has strong brand equity and the client list includes names such as Charles De Gaulle airport, Metronet, Cairo Metro, Otis, RATP (Paris Metro), Calcia, Tubelines, British Environment Agency, Birse Civils, among others, the company said.
Sedis has a presence in almost 100 countries through its vast distribution and sales network. It has two plants in France and a marketing company in the United Kingdom.
“The synergies from this acquisition will not only help us enter new technologies and strengthen our existing technological expertise but also help us emerge as a leading global player in the industrial chains business. With this acquisition, we will be able to offer the requisite technical skills and a complete range of products to meet the requirements of our customers both in the Indian and global markets,” L Ramkumar, managing director of Tube Investments said.
“We have seen our relationship with Murugappa Group grow on the back of very qualitative, transparent and fair dealings. We are happy we have been able to come together and look forward to work with Tube Investments to combine the technical skills, market reach and engineering excellence to grow the chains business of both the Companies.” Robert Armand, chief executive officer of Sedis said.
Kotak Investment Banking was the financial advisor to Tube Investments in the transaction.
Source: My Digital FC