Indian promoter buys back 100% stake in the Indo-Japanese JV; KYB-Conmat, 3rd largest player in Concrete Equipment Business

Conmat Group, promoted by first-generation technopreneur Mr. Premraj Keshyep acquires complete control of INR 3.3 billion KYB Conmat Private Limited, buying back 51% stake from its JV partner- "USD 2.9 billion KYB Corporation", a Japanese behemoth in concrete equipment. Being an inter-partner privately negotiated transaction, the value is undisclosed.

KYB Conmat Private Limited (“Company”), is a major market player in India and one of the top 3 manufacturers of Concrete Construction Equipment like Batching Plants, Paving Machines, Transit Mixers, Concrete Pumps and Self-Loading Mixers etc., competing against homegrown, Kedara Capital-backed Ajax Engineering (which just went public), Chinese-owned Schwing Stetter & Sany Heavy Industries. Exclusively advised and steered by global M&A advisory firm Singhi Advisors, Share Purchase Agreement and transfer of control have been completed with assistance from DSK Legal.

The joint venture was formed in 2013 when KYB Corporation of Japan (“KYB”) acquired 51% stake in the fast-growing and consistently profitable "Conmat Systems Private Limited" and was operated as a JV company for over a decade to produce transit mixers using KYB technology and other products that were indigenously developed by Conmat. The company increased its revenue by 6-fold during this period.

In a unique transaction, wherein an Indian company has bought back a controlling stake from a major Japanese partner, KYB has granted a non-exclusive license to allow the company to continue using the existing transit mixer technology. The company will continue to manufacture all the existing products to sell in India and export globally.

India is aspiring to be a developed nation by 2047, and to achieve this ambitious target, a substantial investment in infrastructure is being made, which is pushing the demand for advanced Construction Equipment. The Concrete Construction Equipment Market in India is expected to grow from current INR 88 billion to approximately INR 230 billionby 2029 @ CAGR of ~21%. Further, the “Make in India for the World” movement is getting traction, and India is emerging as a key player in USD 18.5 billion Global Concrete Equipment Market, which is expected to reach USD 25 billion by 2029. This growth is mainly driven by Infrastructure Development, Urbanization and the adoption of new technologies. With its comprehensive range of Concrete Equipment and Services across the concrete value chain, the company is fully geared up to capture this growth. Identifying the opportunity, Conmat Group decided to invest in the acquisition and leverage its design, development, and manufacturing capabilities to cater to this growing requirement.

The company has a very strong workforce of 450 highly qualified professionals in addition to over 350 contractual workmen. With its extensive network of over 200 Sales & Service Engineers, 10 Domestic and 4 International Dealers, the Company is supplying its products pan India and to over 25 countries across the globe.

Conmat Group has always been at the forefront of Innovation and Technology and has made substantial investment in Research & Development. A strong technical and R&D team of 50+ engineers are constantly working to Design & Develop, Innovative, Technologically advanced, User Friendly and Environmentally Sustainable Products, using their Ultra-Modern Research, Development and Manufacturing facilities in Vadodara, Gujarat.

Talking about the acquisition, Premraj Keshyep, the founder of Conmat Group of Industries, who is also the Vice-Chairman of CII Gujarat State Council, said, "With this acquisition, the company has taken a significant step towards making India “Atmanirbhar Bharat” in the true sense."

To address this huge opportunity for growth, coupled with sufficient manufacturing capacity available & headroom for growth, the company has embarked upon aggressive plans to scale up its operations to triple its revenue to over INR 10 billion in the next two years. The 100% ownership of the company will empower Conmat to take prompt decisions and steps which are necessary to speed up growth. This will also enable the company to make the necessary investment in setting up new world-class manufacturing facilities to cater to the growing market requirement.

The company is now extending its product portfolio of Concrete Equipment, developing Electric and AI Driven Machines and also diversifying into manufacturing Earthmoving Machinery.