Greaves Cotton, a multifaceted engineering business, on Thursday announced a four-tranche deal to pay Rs 385 crore to acquire Excel Controlinkage’s full stake in the motion-control systems company.
Greaves Cotton will acquire 60% of Excel Controlinkage in the first tranche, which is expected to be completed in FY26, and 100% of the company in the next three tranches for a total of Rs 385 crore, subject to closing adjustments, the firms said in a joint statement.
Excel, which has been around since 1994 and is based in Nagpur, sells things like heavy-duty push-pull cables, mechanical levers and linkages, and electronic throttle levers. These products are used in commercial vehicles, industrial machines, boats, construction, agriculture, material handling, and marine equipment.
The company says that the acquisition will help Greaves expand its range of fuel-independent powertrains, start exporting, and strengthen its EV ecosystem. Greaves will also be able to move forward with its plan to improve its mechanical, mechatronic, and electronic skills.
Greaves’ executive vice-chairman, Nagesh Basavanhalli, said that the acquisition is very profitable and increases margins on a consolidated level. It also helps the company reach its goal of developing new skills and speeding up the growth of clean technology and last-mile mobility. “Excel has established itself as a leading player in manufacturing mechanical and electronic motion control systems with integrated manufacturing capabilities.” “By harnessing common synergies, the deal will help us to better unlock new growth opportunities and emerge as a catalyst for a self-reliant, full-stack, indigenous mobility ecosystem,” he said.
Ashok Mrig, one of the people who helped start Excel, said that the company was started as an engineering and product manufacturing business that offered solutions to both OEMs and aftermarket clients.
According to Arup Das, managing director of Greaves Cotton, the acquisition, which was recommended by Singhi Advisors, is a synergistic fit and offers numerous levers for unlocking significant synergies in areas like geography, product portfolio, and customer segments. “It will also strengthen our presence in commercial vehicles and the off-highway segment as well,” he said.
Meanwhile, Greaves Cotton reported a net profit of Rs. 6.43 crore during Q3FY23, compared to a net loss of Rs. 6.24 crore during the same period last year. Contrarily, revenue increased by 5.57% to Rs 513.51 crore during Q3FY23 from Rs 486.40 crore in the prior-year quarter.