Engineering major Larsen & Toubro (L&T) on Tuesday sold its electrical and automation (E&A) business to the France giant Schneider Electric for Rs 14,000 crore in an all-cash deal.
The E&A business had net revenue of Rs 5,038 crore in the financial year to March 2017.
The Rueil-Malmaison, France headquartered Schneider Electric SE is a 180-year-old multinational corporation that specialises in energy management, automation solutions, spanning hardware, software, and services.
“The divestment of E&A business is in line with our stated intent of unlocking value within the existing business portfolio to streamline and allocate capital and the management focus for creating long-term value for the stakeholders,” chief executive and managing director SN Subrahmanyan said in a statement.
The partnership with Schneider is a win-win for the employees, business partners, and the shareholders, he added.
The transaction, subject to regulatory approvals, covers all segments of E&A business except marine switchgear and servowatch systems, Subrahmanyan said.
The E&A business offers a wide range of low and medium voltage switchgear, electrical systems, marine switchgear, industrial and building automation solutions, energy management systems and metering solutions.
The E&A business has manufacturing facilities are located at Navi Mumbai, Ahmednagar, Vadodara, Coimbatore and Mysore as well as in Saudi Arabia, UAE (Jebel Ali, Dubai), Kuwait, Malaysia, Indonesia, and Britain.
“The E&A business has had a strong presence for decades and is well-positioned to continue its growth trajectory with outstanding technologies, brands, people and global presence. We believe the partnership with Schneider Electric, which has a strong product and geographic presence, would further enhance the business prospects for E&A business and its employees,” L&T group chairman AM Naik said.