Schneider Electric, in partnership with Singapore-headquartered investment company Temasek, has reached an agreement to buy the Electrical & Automation (E&A) business of Larsen & Toubro. Both Schneider Electric and Larsen & Toubro made independent official statements to this effect.
Schneider Electric will combine L&T-E&A with its own low voltage and industrial automation products business in India.
The transaction will combine Schneider Electric’s strong global technology platform, digital offers and global presence with L&T Electrical & Automation’s wide domestic reach, coupled with end-to-end R&D and manufacturing capabilities specific to Indian market, a release from Schneider Electric said.
The new combined business will be owned by Schneider Electric and Temasek with 65 per cent and 35 per cent shareholding respectively.
It may be mentioned that the deal excludes the marine switchgear and Servowatch systems businesses of L&T-E&A.
L&T E&A offers low and medium voltage switchgear, electrical systems & equipment, energy management, metering and industrial automation solutions. It benefits from an extensive ecosystem of partners covering more than 260 cities in India. It has an efficient local manufacturing footprint with 5 manufacturing locations in India along with robust local R&D capabilities. The company is also present in the Middle-East and South-East Asia markets.
Schneider Electric is committed to investing in India’s growth, with its businesses being present in India since 1963. With this transaction, India will become the third largest country for Schneider Electric in terms of revenues (around €1.6 billion), at par with France.
As part of the contemplated transaction, L&T-E&A would be acquired for an Enterprise Value (EV) of Rs.14,000 crore (around €1.75bn). The deal is subject to customary approvals from the Competition Commission of India and other regulatory authorities and is expected to close once regulatory approvals are in place.
Acquisitions of Schneider Electric in India* (list may not be exhaustive)
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2000: S&S Switchgear
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2000: Crompton Greaves (CG)’s low-voltage business
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2009: Meher Capacitors
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2009: Conzerv
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2010: Areva T&D [low and medium voltage business]
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2010: Zicom [electronic security systems business]
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2010: Uniflair
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2011: Digilink
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2011: Luminous
Featured photograph shows the stall of Larsen & Toubro’s Electrical & Automation business at Elecrama 2018
Also See:
Exclusive interaction with S.C. Bhargava, Senior VP, L&T-E&A
