Foseco India Ltd signs definitive agreement to acquire a 75% stake in Morganite Crucible India Ltd

Foseco India Limited ("FIL"), a part of Vesuvius Group of companies, has executed a definitive agreement to acquire a 75% stake in Morganite Crucible (India) Limited ("MCIL"), from its current promoters viz. Morganite Crucible Limited and Morgan Terrassen B.V., part of Morgan Group of companies, to increase its exposure to the Foundry business in India. MCIL is the holding company for the Molten Metals Systems ("MMS") business in India, a provider of high-tech crucibles, particularly for non-ferrous applications.

FIL is acquiring a 75.00% shareholding in MCIL the consideration for which shall be payable by FIL through issuing and allotting 1,150,800 fresh equity shares of FIL using a swap ratio of 274 FIL shares for every 1000 MCIL shares.

The proposed acquisition will also trigger a mandatory open offer by FIL to acquire up to 25.00% shareholding of MCIL from its public shareholders in accordance with SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, as amended from time to time.

The completion of the proposed acquisition is subject to the receipt of customary approvals required from certain regulatory bodies, shareholders of FIL, and the completion of identified pre-completion covenants under the definitive agreement and is likely to be completed by early October 2025.

This proposed acquisition aligns with the larger acquisition of the worldwide MMS business by the Vesuvius Group from the Morgan Group. The rationale for the proposed acquisition is to expand the Vesuvius Group's Foundry business into the faster-growing non-ferrous market segment and to India, in line with the Group's strategic ambitions. The global MMS business is complementary to the Vesuvius Group's Foundry business and will also increase the Vesuvius Group's global Foundry business's exposure to the Indian market. Substantial cost synergies are expected to create value for the Vesuvius Group.

Commenting on the transaction, Mr Ravi Kirpalani, Chairman of Foseco India Limited, said "This transaction will strengthen our business through offering the high-tech solutions that MMS brings. The expanded business will benefit from being part of the Group's global Foundry business, enabling it to benefit from combined R&D capability and enhanced customer reach".

Shares of Foseco India Limited was last trading in BSE at Rs. 6500.70 as compared to the previous close of Rs. 5622.80. The total number of shares traded during the day was 24633 in over 5833 trades.

The stock hit an intraday high of Rs. 6684.35 and intraday low of 5572.25. The net turnover during the day was Rs. 153325134.00.

Shares of MORGANITE CRUCIBLE (INDIA) LTD. was last trading in BSE at Rs. 1713.85 as compared to the previous close of Rs. 1571.40. The total number of shares traded during the day was 53636 in over 1845 trades.

The stock hit an intraday high of Rs. 1751.00 and intraday low of 1554.00. The net turnover during the day was Rs. 91223333.00.

Source : Equity Bulls

Keywords

FosecoIndia INE519A01011 MajorityStake Acquisition MORGANITECRUCIBLEINDIA INE599F01020