Toshiba acquires 26% strategic stake in UEM India
07 Jan 2014
Toshiba Corporation has agreed to acquire a 26 per cent stake in waste water management company UEM India Pvt Ltd for an undisclosed sum. The stake would be acquired from its existing shareholders including private equity firm India Value Fund Advisors (IVFA).
IVFA had acquired a majority stake in UEM in July 2010. Following the investment, IVFA will continue to own a majority stake in the venture. The company would use Toshiba's investment to drive future growth, it said in a statement.
UEM Group is an international multi-disciplinary environmental services company that specialises in providing turnkey services in water and wastewater collection, treatment and disposal facilities.
Headquartered in Noida, India, UEM has executed projects in over 30 countries across India, South East Asia, North America, Central America and Africa, and has annual revenues of $70 million.
Toshiba has been Japan's leading manufacturer of electrical system for water supply and sewerage facilities for more than 40 years.
The company has also expanded the business into overseas markets including China and Indonesia and has an R&D facility in Singapore.
Toshiba recognises India as a promising country for developing water-related business in the future, and has been searching for a strategic partner.
''This is a strategic growth area for Toshiba and we will bring our expertise and global access to the company, and also learn from UEM's vast experience in delivering complex, turn-key projects around the world. I look forward to deepening our relationship with UEM, IVFA and Krishan Kshetry over the coming years,'' said Naohiro Noro, vice president, water and environmental systems division, Toshiba Corporation.
This collaboration will enable UEM to expand its business, as it gains access to new geographies and new business segments while retaining its India cost advantage. Along with the agreement, an executive officer from Toshiba will be joining the company's board.
Krishan Kshetry, promoter, UEM said, ''The formation of this collaboration is a seminal moment in UEM's journey. We are delighted to work with Toshiba – and believe that this partnership will provide us a bigger canvas to work on.
''India Value Fund has been a most supportive partner who has helped us scale the business and took the lead in re-organising and professionalizing the business. Now we will have support of both partners (Toshiba and IVFA) to grow the business. The water sector has tremendous opportunities and we have the right tools and partners to achieve our vision,'' Kshetry added.
IVFA specialises in transforming mid-sized profitable businesses into industry leading companies. IVFA manages over $1.2 billion for investment in India.