Schneider Electric acquires 74% of Luminous stake

Schneider Electric has aggressive expansion plans for India in the energy efficiency space and has been acquiring companies like Smartlink Network Systems Ltd and acquiring its structured cabling systems business Digilink and Zicom Electronic Security Systems Ltd to name a few.

In yet another historic move, Schneider Electric SA said that it has acquired 74 per cent of the inverter and battery maker Luminous Power Technologies for around EUR215 million or $310 million. This acquisition paves way for an exit for financial investors.

In 2007, CLSA Capital Partners, picked up a minority stake in Luminous for $20 million. Luminous generated revenue of around EUR170 million in the fiscal year that ended in March 2011, Schneider has announced. The total net debt of the company was Rs 240 crore as of 31 March 2011, leading to an implied transaction multiple of ~16x fiscal 2011 EBITDA. The remaining 26 per cent owned by the founders will be subject to put and call options.

With Luminous, Schneider Electric aims to become the leader in the Indian inverters and secured power market and gain access to a complementary retail network. "This acquisition is another significant step for Schneider Electric to become a leader in new economies," said Laurent Vernerey, Executive Vice President - IT Business, Schneider. "Luminous will also provide a platform to expand the inverter market into other new economies, in particular the Middle East, Africa and South-East Asia," he said.

Luminous is a leading player in the Rs. 6,000 crore Indian inverter and power storage market that is growing at more than 20% a year. "We are glad to partner with Schneider Electric.The founders will continue to be closely associated with the future growth of the company in India and around the world," said Rakesh Malhotra, Founder and Chairman of Luminous.

Rakesh Malhotra and Navneet Kapoor will join the new board of Luminous after the deal. Malhotra will continue to be the chairman of the company. But, post-deal, Schneider will appoint Manish Pant as its MD, who is currently the director of Schneider Electric (India).