Sundaram Finance Holdings gets nod to acquire 6.84% stake of Flometallic, also a 7.71% stake in Brakes

After these proposed acquisitions, SFHL’s stake in FIPL will increase from 40% to 46.84% and from 6.67% to 14.38% in BIPL.

Mar 23, 2021 12:03 IST India Infoline News Service

Sundaram Finance Holdings Limited board approved the acquisition of 650 equity shares of Rs1 lakh each, representing 6.84% in Flometallic India Private Limited (FIPL) from the individual shareholders of FIPL for a total cash consideration not exceeding Rs13cr.

The proposed transaction is likely to be completed by end of June 2021. FIPL is engaged in the manufacture of iron castings, for the automotive industry. After this proposed acquisition, SFHL’s stake in FIPL will increase from 40% to 46.84%.

In another filing, the company said that it approved the acquisition of 1,84,372 equity shares of Rs100/-each, representing 7.71% in Brakes India Private Limited (BIPL) from the foreign promoter, viz., ZF International UK Ltd., for a total cash consideration not exceeding Rs350cr.

BIPL is engaged in the manufacture of braking systems for cars and commercial vehicles,

Pursuant to the acquisition of WABCO Holdings INC, by ZF Friedrichshafen AG, Germany, the Competition Commission of India vide order dated February 14, 2020, directed the foreign promoter  of BIPL viz. ZF International UK Ltd. . a subsidiary of AF-AG, to disinvest their entire stake of 49% held in BIPL. The said acquisition is pursuant to the disvestment steps undertaken by ZF.

Accordingly, SFHL would be executing a Share Purchase Agreement (SPA) with ZF International UK Ltd. for the purpose of effecting the acquisition of shares, subject to necessary regulatory approvals. Upon execution of the SPA and receipt of necessary approvals/compliance with conditions imposed, if any, the proposed transaction is likely to be completed in about four months.

After this proposed acquisition, the shareholding of SFHL's stake in BIPL will increase from 6.67% to 14.38%. 

At around 12.15 pm, Sundaram Finance Ltd was trading at Rs2,480.85 per piece down by Rs10.05 or 0.4% on the BSE.

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