Tube Investments of India (TII), a flagship company of the Murugappa Group with multiple businesses ranging from diversified auto-ancillary products, bicycle retailing to financial services and insurance, has signed a share purchase agreement (SPA) to acquire 44.1% stake in ‘Shanthi Gears’, a leading manufacturer of industrial power transmission products, headquartered in Coimbatore, India.
Consequently, the company will be making an open offer to the extent of 26%. The total cost of the acquisition including the public offer is expected to be Rs 464 crore assuming full response to the proposed open offer pursuant to SEBI regulation.
Shanthi Gears manufactures a wide range of products that include gears, gear boxes, geared motors and gear assemblies. It has been designing, manufacturing and supplying various kinds of gears and gearboxes to various industries for a variety of applications for the past four decades. The company has manufacturing operations in Coimbatore spread across 6 units including a Foundry Division and markets its products in India and abroad. The turnover of the company was Rs 178 crore in FY12 with a profit after tax of Rs 28 crore. It is a debt free company as on March 31, 2012.
Tube Investments of India is a flagship company of the $2.4 billion Murugappa Group. It is engaged in manufacturing of precision steel tubes and strips, car doorframes, automotive and industrial chains and bicycles.
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