Siemens has announced that it will acquire a 77 per cent stake in the Chennai-based iMetrex Technologies that specialises in providing integrated security, fire safety and building automation solutions. The exact price at which the buyout will take place is not known.
The acquisition, to be made through an all-cash deal, would be funded from internal accruals, senior officials from Siemens said here on Monday. The move is aimed at strengthening Siemens' building technologies business in India and abroad.
ITL's net sales for the financial year ended March 2007 stood at Rs 161 crore (Rs 1.61 billion). The Siemens management said that it would buy out the remaining stake of ITL over a period of five years. The valuation process was under way, senior officials observed.
The board of directors has approved the integration of the company's building technology business with the newly-acquired company and has proposed to name the new entity as Siemens Building Technologies.
This company will be a subsidiary of Siemens.
Building technology contributes a mere 3 per cent to Siemens' total business of Rs 4,510 crore (Rs 45.1 billion) in India. The building technologies business in India is worth about Rs 1,300 crore (Rs 13 billion) and is growing at an estimated rate of 18 per cent annually. Siemens' building technologies business had been growing at about 40 per cent through the last four years and ITL's business had been growing at a similar pace, said Aditya Chaturvedi, executive vice-president, Siemens' building technologies division.
Siemens and ITL has a combined share of 23 per cent of the Indian BT market. ITL has 190 employees who would be absorbed into the Siemens fold following the acquisition, said Patrick de Royer, executive director and chief financial officer, Siemens.
"While ITL could leverage our extensive BT network in Europe, we can use their knowledge domain to improve our businesses jointly," said de Royer.
ITL has subsidiaries in Hong Kong, Singapore, United Kingdom and Ireland.
