Air compressor maker Elgi Equipments Ltd has acquired Michigan Air Solutions LLC to expand its business in the US.
The Coimbatore, Tamil Nadu-based company said in a stock-exchange filing it bought Michigan Air for $6 million (Rs 42.44 crore). It made the acquisition through unit ELGi Compressors USA Inc.
Michigan Air was established in 2009 and is headquartered in Michigan’s Grand Rapids. It is a distributor and specialist in air compressor sales, maintenance and services. It reported revenue of $11 million for 2018.
The US company has two offices – one in Grand Rapids and another in Plymouth. It services all counties in the Lower Peninsula area of Michigan, which represents 94% of the state’s total market potential.
Elgi was set up in 1960 as a service station equipment and reciprocating compressor manufacturing company. It operates two factories in Coimbatore and caters to diverse sectors.
The company counts Singapore-based private equity firm Nalanda Capital among its investors. Nalanda, which mainly backs publicly listed companies, had invested Rs 42 crore (around $6.5 million) in Elgi in October 2015 for a 2.17% stake. Nalanda held a 2.8% stake in Elgi at the end of September, stock-exchange data show.
Elgi has made a few acquisitions in the past, too. It acquired Italy’s Rotair S.p.a. in August 2012 for an undisclosed amount. In December 2012, it acquired US-based Patton’s Inc.
The company reported consolidated net sales of Rs 1,863.46 crore for the year through March 2019, up from Rs 1,605.31 crore the year before, according to VCCEdge, the data research arm of Mosaic Digital. Consolidated profit after tax rose to Rs 100.87 crore from Rs 96.42 crore.