Specialty oils and transmission conductor company Apar Industries acquired a majority stake in cable manufacturing company Uniflex Cables in its bid to provide end-to-end power solutions.
Pays Rs 50 crore; likely to hike stake further
MUMBAI: Specialty oils and transmission conductor company Apar Industries on Monday acquired a majority stake in cable manufacturing company Uniflex Cables in its bid to provide end-to-end power solutions.
The size of the deal, which will mainly be funded through internal accruals, is close to Rs 50 crore with a controlling stake of 42% in Uniflex Cables run by the Baid family. The family holds 15% stake in the company. The key Baid family members, Ajay Kumar Baid and Jay Kumar Baid, will continue to serve as managing director and joint managing director respectively, while Vijay Kumar Baid will continue as the non-executive chairman.
Uniflex Cables manufactures wide ranges of cables catering to both power and the telecom sectors. This includes both specialty cables as well as LT/HT cables.
Calling it a strategic move, Kushal Desai, managing director, Apar Industries Ltd, said, “The deal size is currently Rs 48.5 crore and may even cross Rs 90 crore through an issue of warrants and a public offer of 20%.”
He said Apar will pump in fresh equity into the company through subscription to 40 lakh warrants at the Sebi formula price to increase the stake to 49%. “After that we will make a public open offer of another 20%, and subject to a green signal, we will take up whatever extra stake we get,” he said.
Desai said entering the cables business will offer a perfect synergy for Apar as “cables come into existence where conductors (Apar’s core business) end.” This is also in line with Apar’s strategy to provide end-to-end power solutions, he said.
Desai said in the next 3 years, he would look at merging the entity completely with the parent company by acquiring the remaining 15% stake held by the Baid family.
“Currenty Uniflex has revenues of up to Rs 130 crore which we are looking at doubling in the next one year and to Rs 500 crore by 2011,” he said. Apar would also focus at increasing the exports to close to 30% of the total revenues, Desai said.
m_promit@dnaindia.net
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}