Mumbai, September 14, 2010: KEC International Ltd.(“KEC”), an RPG Group company, announced today that it has signed a definitive share purchase agreement to acquire Jay Railway Signaling Private Limited (formally known as Jay Electrocom Industries), a Railways Signaling Automation Systems & Technology company. The company undertakes turnkey signaling contracts for the Indian Railways.
Construction of railway infrastructure involves three major components –civil infrastructure and track works, railway electrification and signaling works. KEC, with its strong EPC base and its long association with the Indian Railways, is in an advantageous position to successfully undertake the first two components. Signaling works, being a highly specialized segment of the railways, require technical skills and experience. With this acquisition, KEC is poised to undertake the entire gamut of activities under the Railway Infrastructure segment.
The total purchase consideration for this deal, on debt-free and cash-free basis is ` 13.96 crore (Enterprise Value) which includes ` 7.01 crore net current assets. We expect to close this transaction by end of this month.
Mr. Ramesh Chandak, Managing Director & CEO, KEC International Ltd said “This is a strategic acquisition for KEC as it enables the company to offer the entire range of services in railway infrastructure projects globally. In order to diversify our portfolio, we took a strategic decision to create a separate Railway Division and today we have a visibiitiy of ` 450 crore with order book of ` 300 crore and L1 position in another ` 150 crore. We will be a major player in the Railway Infrastructure segment in the coming years".
Mr. Sanjay Chandra, Chief Executive (Railways Division), KEC International Ltd said, “KEC has a strong growing team of around 50 employees dedicated to Railway Infrastructure. With this acquisition, as well as an association with a Russian Company for track laying, KEC now possesses capabilities to take up construction of a complete Railway line globally. We have already submitted pre-qualification bids for big sized civil infrastructure and track project for the Dedicated Freight Corridor as well as for the Kolkata Metro Projects. With the Government planning to make large investments in Railways, Dedicated Freight Corridor, High Speed Railways, Metro Projects, this will be a tremendous opportunity for KEC to be a part of this nation building process.”
KEC, a RPG Group company, is one of the leading infrastructure engineering, procurement & construction (EPC) companies in the world. KEC has significant presence in Power Transmission & Distribution, Cables, Telecom and Railway infrastructure. KEC has completed projects in over 40 countries and has expertise in handling mega EPC projects across the globe in diverse terrain. Recently, KEC has signed a definitive agreement to acquire SAE towers, LLC, Americas leading tower manufacturing company. KEC is a listed company on major Indian stock exchanges and has approximate annual turnover of ` 4,000 crore (USD 850 mn).
RPG Enterprises is one of India’s leading business groups with a turnover of `.17,000 crore (USD 3.7 bn). RPG Enterprises has a presence in sectors including infrastructure, power, tyres, retail, information technology, carbon black, speciality and entertainment.
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