Crompton Greaves to sell consumer electronics unit for Rs 2,000 crore
25/04/2015
New Delhi: Crompton Greaves, a part of the Avantha Group, on Friday said it will sell its consumer electrical business to a consortium led by Advent and Temasek Holdings for Rs 2,000 crore.
In a BSE filing, Crompton Greaves said its promoter Avantha Holdings will sell its shareholding in its demerged consumer business Crompton Greaves Consumer Electricals (CGCEL) to a special purpose vehicle (SPV) managed by Advent International Corporation, US and Temasek Holdings subject to agreement of terms and conditions. In a letter to Crompton Greaves, Avantha Holdings said: "...We propose to divest our entire proposed shareholding in CGCEL amounting to approximately 34.37 per cent of the total issued and paid up share capital of CGCEL, to one or more SPVs managed by Advent and a wholly-owned subsidiary of Temasek for an aggregate consideration of Rs 2,000 crore." The deal is subject to approvals from the Reserve Bank and Competition Commission of India. In February this year, Crompton Greaves had announced demerging of its consumer products business, which the firm believed will create better growth opportunities for its two large, but significantly different businesses - power, industrial and automation and consumer products.
The company said it will also create a more flexible capital structure for the two businesses to grow independently, allow them to pursue more ambitious strategic goals and create further value for existing shareholders.
Shares of Crompton Greaves today were trading at Rs 164.95, down by 2.11 per cent at the BSE at 1100 hours.
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