Shriram EPC (SEPC), one of the leading engineering, procurement and construction (EPC) service provider, has acquired 55% in Blackstone Group Technologies (BGT), a Chennai-based engineering consulting firm for an undisclosed amount.
Shriram EPC MD & CEO T Shivaraman said, “The acquisition will help us to consolidate our position as a leading provider of engineering services and provide synergies across business lines of biomass power plants and pipe rehabilitation.”
SEPC has the option to acquire the balance equity after three years. BGT India director S Egbal will continue to head the organisation. Mumbai-based Singhi Advisors were exclusive advisors to BGT for the transaction.
The acquisition will be funded through internal accruals. “Partnering with Shriram EPC will be of tremendous benefit to us as this will give us access to better infrastructure and execution capabilities. We now have an appropriate platform in place which will help us to scale up our business and better realise our potential for delivering value to our customers,” Ashref Hashim, founder & chairman of BGT said.
The acquisition of BGT will substantially enhance SEPC’s manpower resources and provide skill sets in design and high value engineering that will strengthen Shriram EPC’s capabilities, especially in the area involving civil and structural engineering, SEPC officials said.
These capabilities are a critical requirement for SEPC on the projects it currently executes and are complementary to their current offerings. SEPC was earlier outsourcing these requirements, and the certainty of supply and the quality control that can now be exercised by SEPC will enable it to bid for larger projects, officials added.
Apart from expanding SEPC’s bouquet of service offering, this acquisition is expected to improve the proportion of the total contract that SEPC can potentially bid for. The acquisition also provides SEPC access to BGT’s marketing teams and infrastructure, both, in India and globally
In addition to strengthening domestic offerings, this acquisition would also enable SEPC to address more markets in the international arena. SEPC also gains access to the strong portfolio (customer base) of BGT which, combined with the addition of BGT’s experienced management team, that has strong relations in the industry, would result in significant business synergies.
Source: Economic Times