Raymond Group to acquire 59% stake in Maini Precision for Rs 682 crore

Raymond Group on Friday announced the acquisition of 59.25 per cent stake in Maini Precision Products (MMP) for Rs 682 crore. The company will fund the deal through a mix of debt and internal accruals. 

“This acquisition is a strategic move to further strengthen Raymond’s existing engineering business with a complementing business that has presence in sectors like aerospace, electric vehicles (EV) and defense,” the company said in its release. 

The acquisition will be concluded through Ring Plus Aqua, a subsidiary of JK Files and Engineering. Post the acquisition, Raymond will consolidate businesses of JK Files, RPAL and MPP, and will form a subsidiary, Newco, where Raymond will hold 66.3 per cent. Newco will focus on precision engineering products. The proforma consolidated revenue of Newco as of FY23 is Rs 1,600 crore and an Ebidta(earnings before interest, depreciation, tax and amortisation) Rs 220 crore. 

“With this acquisition, Raymond’s engineering business will emerge as a large‐scale provider of engineering, automotive, EV, aerospace and defense components,” the company said. 

“This acquisition will catapult the growth of our engineering business and will open new vistas to us for our foray into rapidly growing segments. Raymond Group has always believed in the ‘Make-in-India’ initiative and this acquisition will also provide an impetus to China Plus One strategy that has been benefiting us. These are growing sectors with visible momentum presenting us with ample opportunities to leverage.  I am pleased to welcome Gautam Maini, founder of MPP, to the leadership team of our engineering business, and we will significantly benefit from his domain expertise and his vast experience," said Gautam Hari Singhania, chairman and managing director, Raymond.

MPP has 11 manufacturing facilities in India across two verticals-aerospace, which comprises precision products manufactured for aerospace and defense, and automotive and industrial, that comprises precision products for clean internal combustion engines, fuel injections and transmissions, EV components, hydraulics and industrial as well as agriculture. 

Gautam Maini, founder of MMP, said: “I am delighted to lead Raymond's consolidated engineering business. This strategic merger represents the harmonious integration of our diverse strengths. Leveraging our core competencies, this partnership will usher in myriad opportunities for rapid growth and expansion, affording us a competitive edge in both international and domestic markets.”

InCredMAPE, the investment banking arm of InCred Capital, acted as the exclusive M&A advisor on the transaction.