Ring Plus Aqua Ltd, the auto components arm of the textile and apparel maker Raymond Ltd, has acquired a majority stake in Pune-based Trinity India Ltd. Although the company did not disclose the deal value in its official communiqué to the stock exchanges, various media reports stated that Ring Plus Aqua had bought 78 per cent stake in the company for Rs 54 crore ($11 million), citing a top company executive.
The deal was funded by internal accruals and facilitated by Equirus Capital.
At 12:17 pm, shares of Raymond Ltd were trading at Rs 369.00 a unit on the BSE, down 0.55 per cent from the previous close.
Incorporated in 1974, Trinity India (formerly Trinity Die Forgers Ltd) manufactures machined and forged components for automotive, material handling and hydraulic pumps & valves industries. The company has four manufacturing units, with an installed forging capacity of 12,500 tonnes, and supplies hubs, spindles, connecting rods and similar components. Currently, it has 400 employees on board.
This acquisition will strengthen Ring Plus Aqua’s entry into forged components market and boost the company’s position in the global automotive power train domain. The firm expects to generate additional revenues of Rs 80 crore from the addition of Trinity as a subsidiary.
The Indian forging industry is pegged to be $2.9 billion in size while the global industry is over $115 billion.
In 2008, Trinity India had filed for an initial public offering with the Securities and Exchange Board of India (SEBI) to enter the capital market with a public issue. But the IPO never went through due to turbulent market conditions and a global recession taking a toll on the Indian stock market.
Besides its core business of textiles, Raymond is into engineering and aviation. The engineering division manufactures precision engineering products, such as steel files, cutting tools, hand tools and agri tools, as well as auto components.