With a view to augment its position in the precision engineering segment, the Raymond Group announced the acquisition of a 59.25% stake in Maini Precision Products Ltd (MPPL) for ₹682 crore funded by a mix of debt and internal accruals, the group said in a statement.
The transaction is expected to be completed during the current fiscal.
Eyes aerospace, defence
MPPL has a diversified business with 11 manufacturing facilities in India across two verticals - aerospace and defence precision products; and automotive and industrial, that comprises precision products for internal combustion engines, fuel injections and transmissions, Electric Vehicle (EV) components, hydraulics, industrial ans agriculture.
Gautam Hari Singhania, Chairman & MD, Raymond Ltd said, “this acquisition will catapult the growth of our engineering business and will open new vistas for our foray into rapidly growing segments like Aerospace, Defence, and EV.”
The consolidated business will cater to top global Original Equipment Manufacturers across aerospace, defense, auto and industrial businesses, the company said.
The acquisition would be concluded through Ring Plus Aqua Ltd. (RPAL), a subsidiary of JK Files and Engineering Ltd. (JK Files). Post the acquisition, Raymond will consolidate JK Files, RPAL and MPPL and form a new subsidiary (Newco).
Raymond Ltd. will hold 66.3% in the “Newco” that will focus on precision engineering products. The proforma consolidated revenue of “Newco” as of FY23 are ₹1600 crore with an EBIDTA ₹220 crore, Mr. Singhania said.
Gautam Maini, founder of MPPL will be part of the leadership team of Raymond’s engineering business. The company has a 70% export contribution and generated around ₹750 crore in total revenue in FY23 with 13% EBITDA margin.
