The Hindu Business Line : Kirloskar Electric acquires German co

Bangalore, Aug. 20 Kirloskar Electric Company Ltd (KEC), the flagship company of the Bangalore-based Mr Vijay R. Kirloskar, on Wednesday announced the acquisition of Lloyd Dynamowerke GmbH & Co KG (LDW), Bremen.

KEC, however, did not disclose the consideration for the acquisition. The deal was signed today in Germany by Mr Vijay Kirloskar, Chairman and Managing Director of KEC. Mr Kirloskar was not available for comments.

In a press release issued here, KEC said LDW, founded in 1915, manufactures electrical rotating machines and drive systems which are in demand where performance and efficiency are desired for industrial applications for extraordinary requirements. LDW’s customers include companies such as Siemens, Alstom, Thyssen Krupp and Gottwald.

In 2006, the private equity company, CMP Fonds I GmbH from Berlin, Germany acquired majority ownership of LDW and provided additional capital to the manufacturer of motors, generators and drive systems. For the year ended December 31, 2007, LDW’s revenues were $78 million. It is a profitable entity with positive operating cash flows and growth trends, the release said.

With a gross turnover of Rs 765 crore in 2007-08, Kirloskar Electric is a leading manufacturer of electrical equipment in India. “This acquisition is of strategic interest to us. It will give Kirloskar Electric complementary engineering skills, a unique footprint in Europe and an important customer base built over the last few decades,” Mr Kirloskar was quoted in the press release.

“KEC will benefit from LDW’s technology and ongoing research work with German universities. KEC will be able to sell LDW’s products under the AEG brand name in the Indian subcontinent and ASEAN countries and address the market for high voltage electrical machines over 50 Megawatts.”

Mr Berthold Groeneveld, CEO of LDW, said “The LDW team looks forward to becoming a part of the Kirloskar Electric family. We think that KEC is a perfect fit for our future growth in Europe and worldwide, especially in the emerging markets.”

KEC had over 30 sales offices in India and offices in Singapore, Malaysia and the U.A.E. Mr P S Malik, Joint Managing Director, KEC, said “Kirloskar Electric would distribute LDW products in India and South East Asia and would leverage on LDW’s presence in Europe to sell its products . The synergies generated out of this acquisition will have a multiplier effect on the competitiveness of both companies.”

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