Welspun Gujarat Stahl Rohren (WGSRL), the flagship company of line pipe and home textile major Welspun, is acquiring a majority stake in MSK Projects India Ltd for an undisclosed sum. MSK is a Vadodara-based company, and is engaged in the construction of road and water pipeline.
The acquisition will be made through Welspun’s infrastructure arm Welspun Infratech Ltd. The company said in a statement that the acquisition helped it foray into infrastructure space, as well as to expand its operation into line pipe segment. MSK claims turnover of Rs 450 crore.
BK Goenka, chairman and managing director, Welspun, said in the statement, “the acquisition is an important milestone for Welspun. It helps us in making direct entry into the infrastructure space.”
Welspun has already received the approval of the board of directors, and plans to complete the acquisition in the next three months. Welspun will pay around Rs 400 crore for the acquisition, out of which Rs 200 crore will be infused in MSK for further growth of the company. Welspun Gujarat will make an all cash transaction for the deal.
Welspun plans to increase its stake further to 75% in the company, and will make mandatory open offer to the shareholders of MSK, the statement added.
MSK is engaged in roads and industrial construction through public-private partnership (PPP) model. It owns and operates several BOOT (build, own, operate and transfer) assets in road and water sector.