Elgi Equipments signs technical licensing agreement with D.V.P. Vacuum Technology S.P.A., Italy

Elgi Equipments Limited ("the Company") has signed a technical licensing agreement with D.V.P. Vacuum Technology S.P.A., ("DVP") Italy, on February 15, 2024, to acquire from DVP the know-how, technical information and assistance to assemble, manufacture and sell the "Vacuum Products" in India, and outside India at relevant time with consent of DVP. DVP provides an exclusive, non-transferable right to the Company to manufacture and sell the Vacuum Products in India. Vacuum Products comprise of oil-free and oil-lubricated rotary vane type Vacuum Pumps with possibility to add other types in due course, with mutual consent.

The company to pay DVP a lumpsum fee towards transfer of technical information and training. Further, a Royalty will be paid to DVP for usage of DVP's Patents, other industrial and Intellectual Property Rights and Technical Information as per the terms and conditions mentioned in the Agreement.

The company will acquire from DVP the know-how, Technical Information and assistance to manufacture, assemble and sell "Vacuum Products" in India. Other territories will be covered upon mutual agreement. DVP provides an exclusive, non-transferable right to the Company to manufacture and sell the Vacuum Products in India, and outside India at relevant time with consent of DVP.

Company shall use DVP's Patents, other industrial and Intellectual Property Rights and Technical Information.

DVP shall transmit to the Company the Technical Information within a period of six months from the Effective Date and Improvements immediately.

DVP is prepared to provide assistance to the Company with regard to problems of import substitution, production techniques, engineering developments, variation in designs, etc. to manufacture the Vacuum Products suitable for the specific requirements of the Indian market.

The term of the agreement shall be maximum period of eight years from the Effective Date of the Agreement. During the Agreement term, DVP will not enter into a similar collaboration agreement with a third party for manufacture and/or sale of Vacuum products in India without the prior written consent of the Company.

Company will have the right to continue producing, selling and maintaining the Vacuum Products without the need to pay Royalty and/or any other payments after termination of the agreement. However, the foregoing will not apply to the territories of USA & Europe unless DVP consents to it.

Post termination, DVP has agreed to effect supplies of Core Parts without any disruptions to price, quality and lead time.

Post termination of the agreement, DVP and the Company have agreed to terms and conditions as mentioned in the agreement, to ensure that customers are not adversely impacted and business continuity is maintained.

Shares of Elgi Equipments Limited was last trading in BSE at Rs. 669.00 as compared to the previous close of Rs. 613.25. The total number of shares traded during the day was 115902 in over 5450 trades.

The stock hit an intraday high of Rs. 685.00 and intraday low of 612.00. The net turnover during the day was Rs. 77397931.00.

Source : Equity Bulls

Keywords

ElgiEquipments INE285A01027 TechnicalLicensingAgreement DVPVacuumTechnologySPA Italy