Elecon Engineering eying overseas acquisition
The Telegraph reported that Gujarat based Elecon Engineering Company is getting ready for an overseas acquisition and hopes to complete the deal in the next 6 to 9 months.
Mr Hemendra C Shah CFO & VP of Elecon said that "We have already started looking for acquisitions in the domestic and overseas markets and have appointed consultants for this purpose. We are getting some proposals but have not found a suitable company."
Elecon is keen on an US or a European gearbox manufacturer having an annual turnover of between INR 350 crore and INR 400 crore. In 2007-08, the material handling business booked orders of INR 1,234 crore, while the gearbox business obtained orders of INR 400 crore.
Mr Shah said that "As on March 31st 2008, we had a pending order book position of INR 1,085 crore for the material handling segment business and INR 202 crore for the gearbox division. During the current financial year so far, we have witnessed strong order inflows. Looking at the trend we expect to book orders between INR 1,700 crore and INR 1,800 crore in 2008-09."
He added that "We are also expanding our existing capacities both in the gearbox and material handling divisions. In 2007-08, we invested INR 82 crore in a windmill gearbox unit. In the current financial year, we have earmarked a capital expenditure of INR 120 crore for expanding capacities at material handling and gearbox facilities. We will have to consider an equity dilution through a second public issue to raise part of the fund we may need for capacity addition and overseas acquisition."
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