Exide Industries to acquire Tudor’s factory in Gujarat1 min read . Updated: 25 Jun 2018, 10:07 PM IST
The acquisition of Tudor's 15.9-acre factory would allow Exide to rapidly start a new manufacturing unit
Kolkata: Industrial and automotive battery maker Exide Industries Ltd on Monday announced it had reached an agreement with Tudor India Pvt Ltd to acquire its factory in Gujarat at an undisclosed price that is expected to be less than Rs25 crore.
The acquisition of Tudor’s 15.9-acre factory is expected to be concluded within a month, Exide said in a regulatory filing. It is going to be the company’s first acquisition in 20 years: In 1998, Exide had acquired battery maker Standard Furukawa.
Tudor is a subsidiary of GNB Industrial Power (UK) Ltd, and is part of Exide Technologies group. It used to manufacture and sell lead-acid storage batteries under the Prestolite brand in India. But its plant in Gujarat is shut for years. When in operation, the factory could produce at least 450,000 batteries per year.
In May last year, Exide had entered into a settlement agreement with Exide Technologies of the US over the ownership and usage of the Exide trademark in India, capping 19 years of legal battle. Under the agreement, Exide Technologies perpetually gave up its claim to the Exide trademark in India.
The sale of Tudor’s factory marks the exit of the US-based Exide Technologies from India, said a key official at Exide, who asked not to be named. Had the price exceeded Rs25 crore, the company would have to mention the price in its regulatory filing in line with Indian securities market regulations, said the official.
The acquisition of an existing factory would allow Exide to rapidly start a new manufacturing unit, according to the official quoted above. “We are in the business of hazardous materials and it takes a long time to get clearances for a new factory," he said.
Exide, which has seven manufacturing facilities, is India’s biggest lead-acid storage battery maker with a production capacity of 39.9 million units a year, according to a recent report by ICICI Securities Ltd.
With a market share of more than 60% in the original equipment manufacturer segment, Exide is “well placed" to benefit from the revival in the demand for passenger vehicles, ICICI Securities had said in its report.
Exide’s shares on Monday closed almost unchanged at Rs251.20 each on BSE in a firm market in which the Sensex gained 219.25 points, or 0.6%, to close at 35,470.35 points.