Zuari Industries Consolidates Texmaco Rail Stake with Strategic Internal Transfer

Zuari Industries Limited, a prominent player in the Indian industrial landscape, announced a strategic move to consolidate its ownership stake in Texmaco Rail and Engineering Limited (Texmaco). The company’s Board of Directors recently approved the acquisition of equity shares in Texmaco for a maximum consideration of ₹200 crore (approximately USD 24 million) from Zuari International Limited (ZIntl), a wholly-owned subsidiary of Zuari Industries.

Internal Restructuring and Continued Focus

This transaction signifies an internal restructuring within the Zuari Industries group. Currently, Zuari Industries and ZIntl together hold a combined ownership of 16.15% in Texmaco. Following the completion of the share purchase, this combined holding will remain unchanged at 16.15%. However, the key difference lies in the direct ownership structure. This strategic move allows Zuari Industries to increase its direct ownership stake in Texmaco, while ZIntl’s holding will decrease proportionately.

Transaction Timeline and Considerations

The acquisition is anticipated to be finalised within the current financial year (FY 2024-25). Zuari Industries plans to purchase the Texmaco shares from ZIntl in one or more tranches, with the purchase price determined by the prevailing market rate and adhering to SEBI (Securities and Exchange Board of India) guidelines for block deal pricing.

About Texmaco Rail and Engineering Limited

Texmaco, established in 1998, is a diversified engineering company with a proven track record in manufacturing a wide range of products. Their portfolio includes Railway freight cars,

Hydro-mechanical equipment and industrial structures Locomotive components Steel girders for railway bridges, Steel castings, Beyond manufacturing, Texmaco undertakes EPC contracts (Engineering, Procurement, and Construction) on a turnkey basis for various railway infrastructure projects, including tracks, signalling and telecommunication systems, rail electrification, and automatic fare collection systems.

About Zuari Industries Limited

Zuari Global Ltd is the holding company of the well-established and diversified Adventz Group. The Company’s primary business activities are real estate, investment services, engineering services, management services, furniture manufacturing and trading, sugar manufacturing and sale, ethanol, and power generation.

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.