India’s leading engineering, technology and construction conglomerate Larson & Toubro (L&T) has announced the sale of its Electrical and Automation (E&A) business to global firm Schneider in an all cash deal for Rs 14,000 crore.
India’s leading engineering, technology and construction conglomerate Larson & Toubro (L&T) has announced the sale of its Electrical and Automation (E&A) business to global firm Schneider in an all cash deal for Rs 14,000 crore. In an exchange release, L&T said that it has signed definitive agreements with Schneider Electric, a global player in energy management and automation for strategic divestment of its Electrical and Automation (E&A) business for an all-cash consideration of Rs 14,000 crore. The deal is subject to regulatory approvals. The deal values L&T’s electrical and automation division at about Rs 14,000 crore including debt. Further, Schneider will own 74 percent of the unit when the deal is complete, while Temasek Holdings Pte will own the balance, according to a Bloomberg report.
The company’s electrical and automation business is involved in providing voltage switchgear, electrical systems, marine switchgear, industrial and building automation solutions, and energy management systems. The manufacturing facilities are located various locations across the country as well as abroad including Navi Mumbai, Ahmednagar, Vadodara, Coimbatore and Mysore in India as well as in Saudi Arabia, UAE (Jebel Ali, Dubai), Kuwait, Malaysia, Indonesia, and the UK.
Commenting on the strategic rationale for the deal, A M Naik, Group Chairman, Larsen & Toubro said that the partnership with Schneider Electric, which has a strong product and geographic presence, would further enhance the business prospects for E&A business & its employees. “L&T’s E&A business has had a strong presence for decades and is well-positioned to continue its growth trajectory with outstanding technologies, brands, people and global presence,” he said.
The electrical and automation business of the company reported a net revenue of Rs 5,038 crore during fiscal year 2016-17.
L&T is a leading Indian multinational company that deals in technology, engineering, construction, manufacturing and financial services with revenue of over $17 billion. The company has its business spread in more than thirty nations.