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Auto component maker Varroc Engineering Ltd on Friday announced that the company will divest its four-wheeler lighting business in the Americas and Europe to France's Compagnie Plastic Omnium for 600 million euros ($630.96 million). Shares of Varroc Engineering jumped over 17%, hitting 52-week high level of 494 apiece on the BSE in early deals.

“The divestment is part of VEL’s (Varroc) strategy to align its resources with the high value and high growth primary markets in China, India, and the two-wheeler sector globally. The Euro 600 million transaction will see Varroc divesting its lighting System operations in the USA, Brazil, Mexico, Poland, Czech Republic, Germany, Turkey, and Morocco," the company said in an exchange filing.

In a bid to transform itself into a high-tech company and focus on the existing growth of electronics, connectivity, electrical vehicles (EVs) product lines and the 2-wheeler segment globally, Varroc Engineering Limited has signed a Securities Purchase Agreement (SPA) with Compagnie Plastic Omnium SE of France to divest its 4-wheeler lighting systems operations in the Americas and Europe.

Varroc will also continue to operate its China JV and other international 2-wheeler businesses in countries like Italy and Vietnam and global electronics businesses in Poland and Romania. The company is retaining its 4-wheeler lighting operations in Asia.

The planned divestment of Varroc’s 4-wheeler lighting systems businesses in the Americas and Europe will ensure enhanced shareholders’ value, sustainable growth, and further development of its R&D facilities and engineering capabilities, it added.

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