BS acquires businesses of Agarwal Steel Structures and 3 other companies

BS Limited, a Hyderabad-based company engaged in power sector transmission and distribution business, has announced plans to acquire businesses from Agarwal Steels Structures India Private Limited, Durafast Automotive Private Limited, NHS Metals Private Limited and Rajesh Sandhi Infras & Metals Private Limited for a total investment of Rs 937 crore.

The acquisitions are to be undertaken through slump sale from the respective sellers. The proposed transactions are expected to significantly improve bidding capability, financial synergy and facilitate scaling up the value chain, apart from expansion into Railway electrification under EPC, according to the company.

Rajesh Agarwal, Chairman and Managing Director, of BS Limited said, “The Board has been evaluating different inorganic options for potential of backward and forward integration which will suit the strategic objective of the Company.”

“The proposed acquisitions are expected to benefit the Company through improvement in bidding strength, enhanced cost control, expansion into railway electrification under EPC, operational and financial synergies and strengthen the foothold of the company in the industry. With this acquisition, the company aims to achieve revenues of Rs 10,000 crore in the next two-three years,” he said.

The company reported a 6.8 per cent increase in its net profit at Rs 75.19 crore on a consolidated basis for the financial year ended March 31, 2015 as against Rs 70.37 crore in the last fiscal. Total Income for the full year stood at Rs 2,673.14 crore, up 15 per cent over Rs 2,320.72 crore in the previous fiscal.

On a standalone basis, the revenues stood at Rs 1904.92 crore, as against Rs 1770.38 recorded in the previous year. The net profit stood at Rs 68.58 crore in FY15 on a standalone basis and at Rs 22.56 crore in Q4FY15.

The Board of Directors today approved a synergetic business proposal aimed at expediting growth through inorganic expansion and by acquisition of these assets. These are expected to enable the company to become an end-to-end service provider in the Power T&D sector.

Subject to statutory approvals, the acquisition covers different operational businesses including tower manufacturing, component manufacturing such as anti-theft fasteners, steel structures, transmission line hardware and related EPC businesses.