NSR set to invest $40 m in Rolex Rings
The US-based private equity player New Silk Route (NSR) is close to investing around $40 million to acquire 26% in Rajkot-based Rolex Rings. Rolex Rings.
By TNN |
MUMBAI: The US-based private equity player New Silk Route (NSR) is close to investing around $40 million to acquire 26% in Rajkot-based Rolex Rings. Rolex Rings, a leading player in barings and automative sector, is wholly-owned by the Madeka family.
The unlisted firm, which makes forged and rolled rings for all types of bearings, posted Rs 1 crore loss on Rs 160 crore revenues in 2006-07, is emerging as a turnaround case. Sources said the deal may be announced within a few weeks.
A senior NSR official confirmed that the company had signed a term sheet with the company. “The company has got certain growth trajectory. Our investment is based on the company’s future prospects,” said the official. The company is expected to clock in around 100% growth in revenues to over Rs 300 crore, and post Rs 70 crore operating profit (EBITA or earnings before interest, taxes and amortisation) and Rs 25 crore net profit. It is currently rolling out a Rs 250-crore expansion plan.
“PE funds are no longer demanding excellent past performance as a pre-requisite for infusing funds. They are now looking for companies with future prospects rather than their performance record,” said a leading PE official.
Rolex has placed an order for high-speed hot former for small diameter parts. It has also placed an order for a new high-speed hotmatic former. This machine can produce about 13,000 rings per hour with maximum weight of 800 gm. Its future plans include buying another high-speed hot former and an online crack detector, apart from replacing old presses with new ones.
Rolex Rings has an engineering centre that comprises of advanced computer aided design, manufacturing and analysis capabilities which cater to customer needs right from concept design to validation and testing.
Its second investment was in Reliance Telecom Infrastructure Ltd (RTIL). NSR was one of the 7 investors in RTIL, which picked up 5% stake for $337.5 mn. Its co-investors were Fortress Capital, HSBC Principal Investments, Galleon Group, GLG Partners, Quantum Fund (George Soros) and DA Capital.
NSR is now close to acquiring about 73% stake in telecom infrastructure provider and tower company Aster Infrastructure for around Rs 233 crore. The PE fund is likely to pick up equity in three tranches in the Secunderabad-based company.
The unlisted firm, which makes forged and rolled rings for all types of bearings, posted Rs 1 crore loss on Rs 160 crore revenues in 2006-07, is emerging as a turnaround case. Sources said the deal may be announced within a few weeks.
A senior NSR official confirmed that the company had signed a term sheet with the company. “The company has got certain growth trajectory. Our investment is based on the company’s future prospects,” said the official. The company is expected to clock in around 100% growth in revenues to over Rs 300 crore, and post Rs 70 crore operating profit (EBITA or earnings before interest, taxes and amortisation) and Rs 25 crore net profit. It is currently rolling out a Rs 250-crore expansion plan.
“PE funds are no longer demanding excellent past performance as a pre-requisite for infusing funds. They are now looking for companies with future prospects rather than their performance record,” said a leading PE official.
Rolex has placed an order for high-speed hot former for small diameter parts. It has also placed an order for a new high-speed hotmatic former. This machine can produce about 13,000 rings per hour with maximum weight of 800 gm. Its future plans include buying another high-speed hot former and an online crack detector, apart from replacing old presses with new ones.
Rolex Rings has an engineering centre that comprises of advanced computer aided design, manufacturing and analysis capabilities which cater to customer needs right from concept design to validation and testing.
ADVERTISEMENT
For New Silk Route (NSR), the investment in Rolex is going to be the third investment ever since it began operations last year. Earlier, the PE major, along with Temasek, invested in INX Media, the broadcast company set up by Indrani Mukherjea.Its second investment was in Reliance Telecom Infrastructure Ltd (RTIL). NSR was one of the 7 investors in RTIL, which picked up 5% stake for $337.5 mn. Its co-investors were Fortress Capital, HSBC Principal Investments, Galleon Group, GLG Partners, Quantum Fund (George Soros) and DA Capital.
NSR is now close to acquiring about 73% stake in telecom infrastructure provider and tower company Aster Infrastructure for around Rs 233 crore. The PE fund is likely to pick up equity in three tranches in the Secunderabad-based company.
Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
