[ad_1]
Varroc Engineering has signed a Securities Purchase Agreement (SPA) with Compagnie Plastic Omnium SE of France to divest its four-wheeler lighting systems operations in the Americas and Europe, the Aurangabad-based company said in a statement.
The Euro 600 million transaction will see Varroc divesting its lighting System operations in the USA, Brazil, Mexico, Poland, Czech Republic, Germany, Turkey, and Morocco.
The move is part of the larger strategy to transform Varroc into a high-tech company and focus on the existing growth of electronics, connectivity, electric vehicles (EVs) product lines and the two-wheeler segment globally, it said.
This divestment will help the company to align its resources with the high value and high growth primary markets in China, India, and the two-wheeler sector globally, it added.
Varroc will also continue to operate its China JV and other international two-wheeler businesses in countries like Italy and Vietnam and global electronics businesses in Poland and Romania. The company is retaining its four-wheeler lighting operations in Asia.
“Our immediate goal is to be future-ready with continued profitable growth in emerging sectors like the EV and high technology electronics,” Tarang Jain, chairman and managing director of Varroc Engineering said in the statement. The divestment of the company’s passenger car lighting operations in the Americas and Europe “will be a win-win deal for Varroc and Plastic Omnium,” said Jain.
It would help the company “unlock great value” for all its shareholders, employees, and business partners as it plans for our next level of growth in the fastest-growing economies and auto sectors in the world, Jain said in the statement.
“Varroc Lighting Systems is a strategic addition to our business that will provide us with an extensive lighting product portfolio,” said Laurent Favre, Chief Executive Officer of Plastic Omnium.
With the Indian automobile sector, including 2-wheelers, 3-wheelers, and passenger car segment, poised to grow at 10-12 per cent CAGR over the next 4-5 years, and with emerging alternative technologies in electric vehicle (EV) mobility, Varroc will be investing in operations and R&D to enhance its shareholders’ value by creating a robust and financially strong operation, ensuring higher return on investments, the company said.
Rothschild & Co acted as the exclusive financial advisor to VEL on the transaction, financially strong operation, ensuring higher return on investments, the company said.
Rothschild & Co acted as the exclusive financial advisor to VEL on the transaction.
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
[ad_2]
Source link