Mumbai: Power and infrastructure EPC services provider Kalpataru Power Transmission Ltd (KPTL) has signed a definitive agreement to acquire a 85% equity stake in Linjemontage i Grastorp AB (LMG) for an enterprise value of $24 million, the company said in a stock exchange filing on Monday.
LMG is an EPC (engineering, procurement and construction) firm headquartered in Grastrop, Sweden. It specializes in power supply solutions and services for electricity networks within the voltage range of 0.4-400 kv. The company operates in three main business areas, comprising substation, transmission and local networks and electricity network services, with revenues of around $75 million in 2018. It has presence in Sweden and Norway with an order book of around $77 million as on date, the filing said.
“The acquisition of LMG is in-line with KPTL’s stated objective of growth and greater geographical presence in stable and growing markets with focus on the power transmission segment," KPTL said.
The transaction is expected to close in the first quarter of FY20. Mumbai-based investment banker Singhi Advisors acted as the advisor to KPTL for the acquisition.
“We continue to expand our geographical reach aligned to our vision of being a local player in the global environment. This acquisition has been carried out on grounds of strategic fit both to capture local market opportunity and to help us in expanding our presence in Nordic countries where we have no former presence," said Sanjay Dalmia, executive director, KPTL.
This strategic acquisition will also help KPTL with greater access to specific expertise and EPC capability to take turnkey projects in Nordic countries and Europe, he added. “The company has a consistent track record of revenue growth of around 15% CAGR over last 5 years, along with consistent profitability."
KPTL is part of the Kalpataru Group, a diversified conglomerate spanning real estate, power generation and transmission, construction of roads, factories, buildings and oil and gas infrastructure. It has a presence in more than 50 countries.
The announcement by KPTL was made after the market hours. Shares of KPTL ended the day at ₹433.75 apiece, down 2.5% on the BSE, while the benchmark Sensex closed at 37,808.91 points, down by 0.93%