In the transaction, Kineco will sell the assets of its pultrusion business into a new company, Kineco Exel Composites India, in which Exel Composites will subscribe to a 55 per cent ownership in a directed share issue. Kineco will remain a shareholder with a 45 per cent shareholding through its main entity Kineco Limited. The new joint venture Kineco Exel Composites India targets growing the pultrusion business in India. The joint venture seeks significant business growth especially in the large and growing industries such as wind power, transportation and telecommunications. The joint venture will continue to operate from the existing manufacturing facility located in Goa, Exel Composites said in a press release.
“The strategic investment provides Exel with direct presence in the fast-growing Indian composites market. Kineco’s long and established position in the Indian composites industry allows us to expand into India with a ‘flying start’. The investment fits Exel’s strategy and growth initiatives well, and clearly strengthens our competitive position towards current and new customers. We are looking forward to joining forces with the committed local team and boosting our future presence in India,” Riku Kytömäki, president and CEO of Exel Composites said in a statement.
“Kineco is happy to be the partner of choice for a leading global company such as Exel, who has decided to invest in India. Exel’s technological expertise and composites know-how, particularly in pultrusion, will enable bringing our own, more recent pultrusion business to the next level. Our previous strategic long-term partnerships with international partners have been extremely successful and we look forward to extending this success story to Exel JV. We welcome Exel to India and look forward to growing our pultrusion business together while at the same time, creating long term value for the shareholders of both the companies,” Shekhar Sardessai, founder and managing director of Kineco and managing director of Kineco Exel Composites India said in a statement.
The parties have agreed that the size of the investment will not be disclosed. The transaction is expected to be completed in the fourth quarter of 2021.
Fibre2Fashion News Desk (GK)