Defying all odds, the Ahmedabad-based e-bike maker and induction melting furnaces & refining equipments company, Electrotherm has sold its ductile iron pipe business to Saint Gobain for a whopping Rs950 crore.
Even as the economy continues to wobble, the company on Thursday said that it has signed agreements with French company, Saint-Gobain Produits Pour La Construction SAS, France. The agreement will enable Saint-Gobain to acquire the ductile iron pipes business and 100% stake in a subsidiary of the company for Rs950 crore plus the value of working capital at closing.
The sale is part of Mukesh Bhandari and his family-promoted company's aim to reduce its debt and focus on its core businesses of engineering and steel.
Founded in 1986, company is producing more than 18 million tonne of steel per annum, right now. In 2005, company diversified into long steel products and ductile iron pipe manufacturing. In six years, after developing ductile iron pipes business, Electrotherm sold it off in 2011.
However, for past two consecutive quarters, Electrotherm was posting losses. In the quarter ended in June 2011, Electrotherm incurred loss of Rs135 crore and in the quarter ended in September 2011, the loss increased further to Rs152 crore.
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