Key Transaction Details

Approval Date: Shareholder approval was obtained on 11th August, 2026 through Postal Ballot process.

Transaction Type: Slump sale of the Friction Business Undertaking as a going concern under Section 180(1)(a) of the Companies Act, 2013 and Regulation 37A of SEBI Listing Regulations.

Financial Metrics of Divested Business (FY26):

  • Turnover: INR 315.04 crores (84% of company's total turnover)
  • Net Worth: INR 69.52 crores (7.50% of company's net worth)

Consideration: INR 370 Crore (Indian Rupees Three Hundred and Seventy Crores Only) to be received in cash, subject to certain transaction adjustments as specified in the Business Transfer Agreement (BTA).

Buyer Information:

  • Name: Rane (Madras) Limited
  • Corporate Identification Number: L65993TN2004PLC052856
  • FY26 Financials: Turnover of INR 3,863.42 Crores, Net Worth of INR 773.20 Crores
  • Business: Manufacturer of automotive products including Steering and Suspension systems, Brake components, Engine components, and Light Metal Casting components
  • Relationship: Does not belong to Promoter or Promoter Group

Transaction Timeline:

  • Agreement Execution Date: 30th June, 2026 (subject to shareholder approval)
  • Expected Completion Date: On or before 30th September, 2026 (subject to closing conditions)

Related Party Status: The transaction does not qualify as a related party transaction.

Rationale for Transaction

The divestiture of the Friction Business Undertaking is described as a strategic move that:

  • Unlocks embedded value not fully reflected in the company's market capitalization
  • Aligns with the company's stated priorities of enhancing shareholders' value
  • Offers natural fit with Rane (Madras) Limited's existing friction business
  • Streamlines portfolio by reducing complexity and simplifying operations
  • Avoids significant upcoming capital expenditure cycle required to keep the Friction Business competitive
  • Strengthens the company's balance sheet
  • Expected to be EPS-accretive
  • Results in more predictable and stable earnings profile
  • Reduces exposure to capital intensive segment with intensifying competition and technology disruption

Use of Proceeds

The proceeds, net of transaction cost and tax expenses, will be deployed to:

  • Fund investments in line with long-term strategy of enhanced shareholders' value
  • Partially returned to shareholders by way of a special dividend

Additional Information

  • No change in shareholding pattern of the listed entity resulting from this transaction
  • The disclosure includes all required information as per SEBI Master Circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated 30th January 2026
  • The company's remaining businesses include Treasury and Investment Business, and Commodity Trading