Schneider acquires L&T's electrical and automation unit for Rs 14, 000 crore
Schneider Electric has acquired Larsen & Toubro’s (L&T) electrical and automation business. The deal was valued at `14,000 crore. Schneider would partner with MacRitchie, a wholly-owned subsidiary of Singapore-based Temasek Holdings, to complete the acquisition.
The Competition Commission of India (CCI) has approved the acquisition but has twitted that the approval is “subject to compliance of certain modifications.”
According to the acquisition deals, Schneider India would be able to access L&T’s distribution network in over 260 tier II and tier III cities and rural areas where it currently does not have a significant presence. The company was banking on the completion of the deal to develop India as its “fourth hub”, after US, France and China. It has made investments of 30 million euro (about `260 crore) annually in the last three years in this country. As soon as the L&T acquisition takes place, the company plans to make India its third largest investment destination globally by 2020.
The sale is part of L&T’s long term divestment strategy of selling its non-core businesses. The business units being sold by L&T also include some of its overseas subsidiaries in Malaysia, Australia, Indonesia, Saudi Arabia and Kuwait. The company’s FY17 automation business revenue of `5,038 crore constituted around 4.5% of its consolidated revenue.
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