Tsubakimoto Chain Co, a Tokyo-based manufacturer of power transmission and chain products, has raised its holding in Mahindra Group’s privately held conveyor systems business from 8.5 per cent to 51 per cent for an undisclosed amount, as per a company disclosure.
The Japanese firm has bought additional stake in Mahindra Conveyor Systems Private Limited (MCS), a subsidiary of Mahindra Engineering & Chemical Products Ltd (MECP), which now makes it a majority stake holder in the company.
It had executed a share purchase agreement with MECP to acquire shares in its subsidiary on July 1 and has completed the transaction on July 31, 2014.
MECP and Tsubaki Bulk Systems Corp. (TBS), a wholly-owned subsidiary of Tsubaki, have collaborated in the field of bulk handling conveyors for the cement industry in India for 25 years. When MECP hived off its conveyor systems business into a separate firm in 2010, Tsubaki had picked 8.5 per cent stake in MCS.
MCS, which is now renamed as Mahindra Tsubaki Conveyor Systems Private Limited, is led by Ravindra Vaidya (CEO). The Pune-based firm employs around 120 people and is into engineering, manufacturing and sale of conveyors and systems.
By leveraging its performance in the bulk handling and automotive industries in India Tsubaki aims to expand its materials handling business on a global scale.
MECP is a supplier of material handling equipment and systems. Its product range includes bulk handling systems as also unit handling systems for various specialised applications. It is a wholly owned subsidiary of the group flagship Mahindra and Mahindra Limited.
This is the second business unit of the multi-billion dollar diversified group where Mahindras have divested a large stake to another partner. Early this year it sold a large minority stake in Mahindra Logistics Ltd to private equity firm Kedaara Capital.
(Edited by Joby Puthuparampil Johnson)
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