Aggreko buys Cummins India power business
By Patrick Hill20 November 2008
Aggreko plc plans to purchase the rental power business and assets of Cummins India Ltd (CIL) for €4.6 million in cash. The deal is subject to approval by CIL's shareholders.
The business to be purchased is expected to have 2008 revenues of approximately €2.8 million and net assets at year's end of approximately €1.3 million.
Aggreko chief executive Rupert Soames said the transaction is "...in line with our strategy of focusing our capital investment in growing markets where attractive returns can be achieved. Our investment in India means we will have achieved one of our strategic objectives, which is to have operations in each of the four largest developing economies in the world (the others being Brazil, Russia and China).
The UK-based company announced its Cummins India purchase on the same day, 20 November, that it sold its oil-free air (OFA) compressor rental business in Europe to Atlas Copco. Mr Soames said, "Oil-free air is the smallest of our product groups, and while we have a large and successful OFA rental business in North America in which we will continue to invest, we do not believe that our European OFA business has the scale to warrant further investment." (See separate story.)