Ratnamani Metals & Tubes Expands Stake in Ravi Technoforge to 80.017%

Ratnamani Metals & Tubes Limited has made a significant strategic move by increasing its stake in Ravi Technoforge Private Limited (RTL).

RTL is involved in the manufacturing of high-precision forged and turned bearing rings, gear blanks, and other bearing components. This acquisition was executed as part of a series of transactions outlined in the Definitive Agreements for the subscription and acquisition of RTL’s equity shares.

The company initially acquired a 53% stake in RTL by subscribing to 8,386,050 equity shares under the first tranche of the agreement. This acquisition was a crucial step for Ratnamani Metals & Tubes as it aimed to diversify its portfolio and tap into the growing industrial and mobility applications market, both domestically and globally.

In a subsequent transaction, Ratnamani Metals & Tubes further strengthened its position by acquiring an additional 4,122,000 equity shares of RTL at a price of ₹81 per share, including a premium of ₹71 per share. The total consideration for this tranche amounted to ₹33.39 crores.

As a result of this acquisition, Ratnamani Metals & Tubes’ stake in RTL increased from 53% to 80.017%, giving it a controlling interest in the company. The total number of shares held by Ratnamani Metals & Tubes in RTL now stands at 12,208,050 equity shares, out of a total of 15,256,716 equity shares.

RTL, based in Rajkot, Gujarat, is recognised as one of the leading manufacturers in its domain. The company boasts a forging capacity of 39,000 metric tons per annum (MTPA) and has substantial in-house annealing and machining capabilities. RTL specialises in producing rings ranging from 40mm to 400mm, with unit weights of up to 25 kilograms. It has more than 1,600 part approvals and a diverse product portfolio that includes tapered roller bearings (TRB), spherical roller bearings (SRB), cylindrical roller bearings (CRB), and Generation 1 hubs.

RTL’s products are crucial components in various industrial and mobility applications, contributing to its longstanding relationships with major global bearing manufacturers.

The acquisition of RTL is aligned with Ratnamani Metals & Tubes’ strategy to add a new growth driver in a stable and mature industry. RTL’s established relationships with global bearing giants and its extensive product approvals provide a solid foundation for future growth.

As per the Share Subscription cum Purchase Agreement dated October 5, 2022, Ratnamani Metals & Tubes had committed to acquiring an additional 27.017% of RTL’s total equity share capital from the existing shareholders upon the second closing, which has now been completed.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.