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KPIT Tech on Wednesday announced that its board has approved the acquisition of four of the Technica Group companies with Euro 80 million ( 640 crore) fixed consideration to be paid over 6 months. The deal is expected to be closed by the end of October 2022, post fulfillment of customary closing conditions, and at the end of it, Technica Group will be fully owned by KPIT Technologies.

“The board has approved the acquisition of Technica Engineering Gmbh, Germany, Technica Electronics Barcelona S.L., Spain and Technica Engineering Spain S.L., Spain through KPIT Technologies GmbH, a wholly owned step down subsidiary of the Company of 100% shareholding and Technica Engineering Inc, USA through KPIT Technologies Inc. a wholly owned step down subsidiary of the Company of 100% shareholding," KPIT Tech informed in an exchange filing.

KPIT Technologies GmbH & KPIT Technologies Inc. (wholly owned step down subsidiaries of the Company) will acquire 100% of the shareholding upfront.

The target entities have leadership in automotive in production-ready system prototyping (combination of network system architecture, hardware prototyping, integration), automotive ethernet products, and tools for validation.

Technica Germany has a presence in Germany, France, Sweden and Asia, with current employee strength of 275. It is headquartered in Munich, Germany. Meanwhile, Technica Barcelona has a presence in Spain, with current employee strength of 50, headquartered in Barcelona, Spain.

Technica Vigo has a presence in Spain, with current employee strength of 4 (No. of employees). It is headquartered in Vigo, Spain. Whereas, Technica US has a presence in US, with current employee strength of 4 (No. of employees). It is headquartered in Bloomfield Hills, Michigan, USA.

Euro 80 million fixed consideration to be paid over 6 months, said the company, adding that maximum Euro 30 million variable consideration based on achievement of revenue and profit milestones to be payable over the next 2.5 years.

“The acquisition will create across-the-stack expertise, offering a one-stop shop for the industry to transform towards SDV. The acquisition will be EPS accretive upon consolidation," the company added.

Shares of KPIT Tech rose more than a per cent to 581 apiece on the BSE in Wednesday's opening deals.

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