CG Power: Announcement of purchase of railway safety system manufacturing company, how much is the deal?
CG Power and Industrial Solutions, a listed company of Murugappa Group, has today announced the purchase of majority stake in a railway safety system manufacturing company. The company has said in the information sent to the stock market that it will buy 55 percent stake in G G Tronics Private Ltd. This purchase will be for Rs 319 crore. The company said in the information sent to the stock market that this acquisition can be completed before August 23, 2024. CG Power has also released its quarterly results today. The company’s profit has increased by 21 percent compared to last year, while the income has increased by 19 percent.
What information has been given about the deal?
The company has informed the stock market that it has signed an agreement to purchase 55 percent stake in GG Tronics. This deal will be in cash and the size of the deal is Rs 319.38 crore. Out of this, Rs 173 crore will be used in the purchase of 1.45 lakh shares, while Rs 146 crore will be spent in compulsory convertible preference shares.
GG Tronics designs and manufactures electronic signaling systems for railways. The company is also a developmental vendor for Railway Security System Kavach. The turnover of the company for the year 2022-23 has been Rs 98 crore.
How have been the results
CG Power’s standalone profit has increased by 21 percent to Rs 232 crore compared to last year. Sales have increased by 19 percent compared to last year and have reached Rs 2106 crore. EBITDA has increased by 25 percent on year-on-year basis to Rs 346 crore.
