Times of India: November, 2016
Pune: City-based Bharat Forge said it will divest its 49% stake in the power equipment joint venture (JV) with French multinational Alstom for a total consideration of $35 million (approx. Rs 230 crore). Singapore-based GE Pacific Private Limited will buy the stake.
An email sent to the company seeking the reason for divestment remained unanswered. "The board of directors in their meeting on Tuesday approved the execution of the share sale/ purchase agreement of the company's entire 49% stake in its joint venture company Alstom Bharat Forge Power Private Limited for a consideration of $35 million to GE Pacific Private Limited," the company said in a BSE filing.
In a conference call with analysts on Tuesday, the company said it had made a total investment of Rs 170 crore in the JV. The JV, incorporated in Delhi with its manufacturing facility at Sanand, was formed in 2009 to address opportunities arising from the expansion in the Indian power sector.
It also said the divestment will also help it pare debt of around Rs 400 crore. The forgings maker posted a 26% drop in its Q2 net profit at Rs 127 crore against Rs 172 crore a year ago. The profit was hit by lower export revenue especially from the Americas.