Mumbai:Â Engineering major Larsen and Toubro Ltd (L&T) on Wednesday announced the sale of unlisted subsidiary EWAC Alloys Ltd as part of its strategy to exit non-core businesses.
In a stock exchange filing, Larsen and Toubro said it has entered into a definitive agreement with ESAB Holdings Ltd, a company registered in the UK, to sell EWAC Alloys for Rs522 crore.
EWAC makes welding products and provides related services. The company, which began as a joint venture of Larsen & Toubro and Germany-based Messer Eutectic Castolin Group, became a wholly owned subsidiary of L&T in 2011.
L&T said EWAC had a revenue of Rs211.2 crore in fiscal 2017, representing around 0.19% of the L&T groupâ€™s consolidated revenue. As of 31 March, it had a net worth of Rs95.69 crore.
â€śSubject to customary closing conditions, the sale is expected to be completed within 90 days from the date of execution of the share sale and purchase agreement,â€ť the statement added.
On Wednesday, shares of L&T dropped 0.83% to close at Rs1,133.3 on BSE, while the benchmark Sensex lost 0.28% to 31,833.99 points. The announcement came after market hours.
The acquirer ESAB offers a huge range of products and solutions for welding and cutting process.
In 2012, ESAB was acquired by Colfax Corp., a diversified industrial manufacturing company based in the US.
In August, L&T agreed to sell its entire stake in unlisted unit L&T Cutting Tools Ltd to IMC International Metalworking Companies BV, owned by Berkshire Hathaway Inc., for Rs174 crore.
L&T was also in talks with ABB, the European engineering multinational, to sell its electrical and automation division,Â The Economic TimesÂ reported on 21 June. L&T has operations in engineering, construction, manufacturing, technology and financial services