Sintex Industries Limited announced that it's wholly owned subsidiary, Sintex Infra Projects Limited (“SIPL”) has signed a definitive agreement with Durha Constructions Private Limited (“DCPL” or “the Company”) to acquire 30% ownership of the Company. As a part of the agreement that is inked with the current owners of DCPL, Sintex will be able to acquire majority ownership of the Company on pre-agreed terms on closing of current financial year, FY'2011.
The primary businesses of Sintex are building products, custom moldings and textiles. This investment shall help Sintex to grow and strengthen its monolithic and prefab business and also building an active presence in the Infrastructure sector, particularly the Engineering, Procurement and Construction (EPC) business that throws tremendous opportunities with robust growth In Indian economy.
DCPL is engaged mainly in the business of civil construction & mechanical construction work in varied infrastructure sectors including power, petrochemicals, cement from medium to large projects in both private and public sectors. Delhi International Airport, Hyderabad International Airport, Indraprastha Power Station amongst others, are some of the prestigious projects that DCPL can claim in their credentials. DCPL has built an impressive client base including EPC giants such as BHEL and L&T where the company has done significant work in association with these companies.
DCPL has grown Revenues by over 40% annually over the past two years. For the year ended 31 March, 2010, DCPL reported Revenues of INR 1.5 billion and EBITDA of INR 252 million. The Company has an order book of over INR 7.5 billion across various Infrastructure sub-sectors.
Sintex has a long history of building successful strategic partnerships and alliances. After the strategic investment by Sintex in DCPL, the Company shall continue to be run by the existing management and help Sintex enhance its execution capabilities in Building solution segment besides other infra projects. Sintex shall play the role of a strategic partner and help the Company on matters.
Meghraj Capital Advisors Private Limited acted as Financial Advisors to Sintex Group for the transaction while MNK law offices acted as the legal counsel on this transaction.
VA Tech Finance (India) Private Limited advised DCPL for this transaction.
Source: Equity Bulls