Hindalco Industries To Acquire Polycab-Subsidary Ryker Base For Rs 323 Crore

Aditya Birla subsidiary Hindalco Industries will acquire 100 per cent equity in wire and cable maker Polycab India's wholly-owned subsidiary, Ryker Base in an all-cash deal for an enterprise value of Rs 323 crore (Rs 3,230 million). Hindalco in a regulatory filing to the Bombay Stock Exchange on Wednesday added that post debt and working capital adjustment, the purchase consideration could come to around Rs 167 crore. This would be subject to adjustment of the final purchase price in accordance with the share purchasing agreement. 

The transaction is expected to be sealed on or before December 31, 2021. 

As per the terms of the transaction, Hindalco's wholly-owned subsidiary, Renuka investments and Finance would acquire 100 per cent in Ryker Base.

According to Hindalco, the acquisition would strengthen its copper rod manufacturing capacity by, "providing a time to time market advantage allowing the Company to cater to the growing demand from electrical and electronic sectors." 

Ryker Base's revenue from operations for the full year ending March 31 was approx Rs 535.04 crore. Its net worth as of March 31 stood at Rs 68.24 crores. "Ryker Base Private Ltd is a wholly-owned subsidiary of Polycab India Limited. Ryker has played a strategic role by manufacturing and supplying copper wire rods which is a key input for manufacturing wires and cables," the filing stated. 

Hindalco Industries is scheduled to announce its second-quarter results on November 12. Polycab India reported an approx 9.5 per cent year-over-year decline in net profits at Rs 200.52 crore in the September-end quarter. Revenues, however, rose 48 per cent at Rs 3,128.83 crore in the second quarter compared to Rs 2,113.68 crore in the same quarter last year.