Sona BLW to acquire Escorts Kubota’s railway business

4 Sep 2024 , 03:39 PM

Sona BLW is in talks with Escorts Kubota to acquire its trains business, according to persons familiar with the subject.

According to insiders, the sale might be valued at around ₹2,000 Crore.

Escorts Kubota’s railroads business generated ₹950 Crore in FY 2024. As of the June quarter, the railway business generated 11% of the company’s total revenue.

Escorts’ talks with Knorr-Bremse are likely to have fallen through because of valuation concerns.

In October 2023, it was reported that the Knorr-Bremse Group was going to buy Escorts Kubota’s railway business for about ₹4,000 Crore, according to sources.

According to the sources, Sona BLW may undertake an institutional share offering (QIP) to raise funds. The company’s board has approved raising up to ₹2,400 Crore through the QIP.

The company also stated that the cash will allow them to evaluate the best financing structure for growth ambitions.

Sona BLW Precision Forgings is an Indian automobile technology firm. The company designs, manufactures, and supplies engineered automotive systems and components such as differential assemblies, gears, conventional and micro-hybrid motors, BSG systems, and EV traction motors for all vehicle types.

The company creates mechanical and electrical hardware systems, as well as foundation and application software solutions.

At around closing, Sona BLW Precision was trading 1.51% higher at ₹721.50, against the previous close of ₹710.80 on NSE. The counter touched an intraday high and low of ₹732.60, and ₹701.50, respectively.

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