Mumbai: ABB Ltd. will pay Rs400 crore to buy some businesses of ABS Global Industries and Services Ltd, a fully-owned unit of its Swedish parent. ABS makes transformer insulation boards and low voltage switches.
In a filing to the Bombay Stock Exchange, ABB Ltd. said it received approval from its board of directors on Friday and the acquisition will be effective from 1 April.
The businesses which have been acquired on a slump sale include transformer insulation boards and components, low voltage breakers & switches, and vacuum interrupters. These new segments are expected to help ABB earn an additional Rs250 crore a year, the statement said.
For the quarter ended 31 December, ABB’s net profit declined 94% from a year ago to Rs6.4 crore. Since June last year, ABB’s promoters have increased their stake in the company to 75% from 52.11%.
“This signals ABB’s intention for control,” said an analyst who didn’t wish to be identified. ABB shares fell 1.34% to close at Rs730.50 a piece in a weak market.