Advent exits Crompton Greaves' India appliances business

The private equity firm has sold about 33.7 million shares for INR13.5 billion ($184.5 million), according to market records. 

Shares in Crompton Greaves Consumer Electricals (CGCE) have zigzagged since the transaction but broadly moved higher. The stock was trading at INR428 mid-afternoon local time, up marginally from the prior close and representing a market capitalization of INR272 billion.

Advent first invested CGCE in 2015, buying a 34% position alongside Temasek Holdings from Avantha Group for INR66 billion. The two investors launched a takeover bid the following year but failed to acquire a controlling stake, having priced the offer at a significant discount. Advent only increased its position by a nominal amount. Temasek acquired no additional shares.

Both investors have gradually exited the company in the meantime, selling a combined 51.2 million shares in December 2019 and a combined 8.8% in November last year. As recently as February, Advent sold a 6.1% stake for INR14.9 billion.

CGCE is considered one of India’s leading manufacturers of household appliances, with a specialization in relatively heavy-duty gear such as water heaters and pumps. It also does significant business in fans, air coolers, and lighting, as well as minor appliances such as toasters and irons.

Annual revenue improved 5.6% to INR48.2 billion during the 12 months to March 2021, while profit increased 22.2% to INR6 billion. Some of the traction was attributed to strong growth in the consumer LED lighting and fans businesses.

US-headquartered Advent has invested at least $1.7 billion in India since 2007. Recent activity includes the acquisition of pharmaceuticals supplier ZCL Chemicals, setting up an exit for Morgan Stanley Private Equity Asia.

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• Topics
• South Asia
• Consumer
• Open market
• Exits
• PIPEs
• India
• Advent International
• manufacturing