By IANS
Chennai : Auto electricals major Lucas TVS Limited, part of the Chennai-based TVS group, has bought the auto component facility of Sical Logistics Limited near Chennai for Rs.146.90 million for its growth plans.
Formerly known as Indrad Auto, Sical Logistics’ auto component division at Maraimalai Nagar makes auto electricals.
The process of demerging the auto components business took some time as the company was focused on getting the structure right and selling in the manner to extract break up value, Ashwin Muthiah, chairman of Sical Logistics, said Wednesday.
The company had discussions with several global auto component companies before inking the deal with Lucas TVS.
However, Sical Logistics continues to retain the high wattage engine cooling modules and motor wiper business of Indrad Auto, as it is part of a technology transfer agreement with Italian company GATE SRL.
The company will continue selling the spare parts till GATE SRL takes a decision on its Indian business, said Karthik Menon, director, Sical Logistics.
With this asset disposal, Sical Logistics has realised a total of Rs.901.80 million through its disinvestment process that started in 2006. The company had earlier sold its sugar, distillery, palm oil and refractory businesses.
The two divisions that are yet to be sold are speciality chemicals and drums. Menon said the two businesses do not get any cash support from Sical Logistics and to that extent they are independent.
For the Rs.9.06 billion turnover Lucas TVS, the acquisition is an apt fit for its growth plans as Indrad Auto too makes auto electricals, said a company official.