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Switchgear maker Salzer Electronics buys 72% stake in Kaycee Industries



Salzer Electronics Ltd, one of the leading players in India offering total and customised electrical solutions, has acquired 72.32 percent in Kaycee Industries Limited from Kaycee’s promoter CMS Group in an all cash deal. Salzer will also make an additional offer to purchase 25 per cent from public for a total equity value of Rs 22 crores. Mumbai based Singhi Advisors, a global investment banking firm focused on M&As, acted as sole advisor to both CMS & Salzer. Incidentally, Singhi Advisors also advised CMS Group when they first acquired Kaycee from Bajaj Electricals in 2002.
 
Kaycee Industries Ltd is a pioneer in industrial switchgear and was controlled by homegrown CMS group which is one of the largest IT/ITES & enterprise solution firms in India.
 
Having is corporate office at Mumbai and manufacturing unit at Ambernath near Mumbai, Kaycee's principal products which include rotary switches, rotary cam switches, micro and toggle switches, weather tight switches, breaker control switches, counters and fuse fittings adds to Salzer's attractive product offerings making it complementary & synergistic to the existing line of business. This will also strengthen Salzer's position in industrial Switchgear segment which constitutes 42 percent of Salzer's current revenue and help Salzer expand is footprint into railways, access to all India dealer network and manufacturing set up in western India.
 
Going forwards, Kaycee lndustries Limited would continue to remain a listed entity and both the companies would share technological support & knowhow with each other especially in the niche product offerings of the industrial switchgear & other allied business segments. The resulting synergies from this acquisition would benefit both the companies on the back of enhanced product portfolio and access to a larger client base.
 
Commenting on this development, R Doraiswamy, Managing Director, Salzer Electronics Ltd, said, “Kaycee being pioneers in the cam operated rotary switch will help our company further to increase our market share in the industrial switchgear industry and consolidate our market leadership in this niche product. This acquisition is in line with our strategy of strengthening and growing our suite of product offerings. The resulting synergy would enable us to penetrate further into the market on the back of enhanced product offerings. We expect that this strategic acquisition to enable us to generate long term value for all our stakeholders."
 
Coimbatore based Salzer, with revenue of Rs 550 crore, is a leading player offering total and customised electrical solutions in switchgears, wires & cables and energy management business. It is the largest manufacturer of CAM operated rotary switches & wire ducts in India, with a market share of 25 per cent & 20 per cent respectively. The company caters to a wide range of products with five in-house manufacturing facilities, located in Coimbatore and Himachal Pradesh. The company has a wide distribution network locally and globally, exporting to more than 40 countries. 
 

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