AEI Cables has a turnover of about Rs5.33bn. It is a leading manufacturer of cables solutions to global markets and is a wholly owned subsidiary of TT Electronics.
Paramount Communications Ltd. said on Tuesday that it will acquire the business of UK-based AEI Cables in an all cash deal. The company did not disclose the consideration to be paid for the acquisition.
AEI Cables has a turnover of approximately £65mn (Rs5.33bn).
Elara Capital Plc, a London-based mid-market advisor, was the sole corporate finance adviser to the company for this transaction.
AEI Cables is a leading manufacturer of cables solutions to global markets and is a wholly owned subsidiary of the international electronic sensors and components group TT Electronics Plc, listed on The London Stock Exchange.
The acquisition of AEI Cables will make the company the largest listed Indian company in the cable industry with an annual turnover of over Rs11bn, Paramount Communications said. It will significantly strengthen its product range for infrastructure segments in India and the UK, it added.
The takeover will enable faster expansion in international markets such as Far East, Middle East and Africa, where the AEI Cables brand is well established, Paramount Communications said. It will give access to cutting edge technical know-how to continue developing new range of products, it added.
The acquisition will significantly strengthen the consolidated balance sheet of the company and is accretive to the net worth by about Rs1.1bn, Paramount Communications said.
The acquisition is funded through borrowings by the company's new wholly-owned UK subsidiary against the AEI Cables assets, Paramount Communications said. The company is only infusing Rs250mn out of the proceeds of FCCBs.
“The AEI Cables business has a distinguished history which can be traced back to 1837. One of the key reasons for the acquisition is to access the world class product development and technical know-how of AEI Cables, especially in the defence sector,” said Sanjay Aggarwal, Chairman & CEO of Paramount Communications.
Source: India Infoline