L&T inks pact with Schneider Electric to divest electrical, automation biz for Rs 14K cr

Engineering major Larsen & Toubro today said it has inked a definitive pact with Schneider Electric to sell its electrical and automation business for an all-cash consideration of Rs 14,000 crore, as part of its long-term strategy to exit non-core activities.

"The company has entered into definitive agreements for the divestment of its electrical and automation business, including the associated subsidiary companies outside India, to Schneider Electric (India) Private Limited and Schneider Electric JV Holdings Pte Ltd, on May 1, 2018," L&T said in a BSE filing today.

Schneider Electric (India) and Schneider Electric JV Holdings are part of Schneider Electric SE, a European multinational corporation, the statement said.

"Larsen & Toubro today signed, subject to regulatory approvals, definitive agreements with Schneider Electric, a global player in energy management and automation for strategic divestment of its Electrical and Automation (E&A) business for an all-cash consideration of Rs 14,000 crore," it said.

L&T said "the divestment is a part of the company's long-term strategy to sell non-core business".

The expected date of completion of sale is within 18 months of the date of signing of the definitive documents.

The electrical and automation business revenues during the year 2016-17 was Rs 5,038 crore, constituting around 4.5 per cent of the company's consolidated revenue for 2016-17.

The divestment includes sale of electrical and automation business division of Larsen & Toubro Ltd and the associated subsidiary companies outside India -- Tamco Switchgear Malaysia Sdn.Bhd, Tamco Electrical Industries Australia Pty Ltd, PT Tamco Indonesia, L&T Electrical & Automation, Saudi Arabia Company Ltd (LLC), L&T Electrical & Automation FZE, HENIKWON SDN BHD (Malaysia), Kana Controls General Trading & Contracting Company WLL (Kuwait).