Crompton Greaves in race to acquire Kenstar from debt-ridden Videocon Group

CG Power and Industrial solutions (formerly Crompton Greaves) logo. Photo: Twitter
Electrical appliances maker Crompton Greaves on Friday said it has submitted a bid for the acquisition of home appliances brand Kenstar from debt-laden Videocon Group.

Kenstar, a subsidiary of the Videocon group, makes kitchen appliances, TVs, air conditioners, air coolers and health appliances.

The company submitted a bid on September 20, 2017, as an expression of interest (EOI) for the acquisition of Kenstar business and Kenstar brand, Crompton Greaves Consumer Electricals Ltd (CGCEL) said in a regulatory filing.

It further said the submission is in response to an invitation received by the company from Videocon Industries and their affiliates through invitation letter dated September 6.

The price of the bid was, however, not disclosed by the company.

The result of the bid process have not yet been announced, the company said, adding that no binding transaction documents have been executed between the company and the sellers and there have been no negotiations so far.

The Videocon group, which is struggling with a debt of over Rs 40,000 crore has been considering sale of its various assets over the past few years to bring down the debt.

ONGC Videsh Ltd, the overseas arm of state-owned Oil and Natural Gas Corp (ONGC), had in June 2013 bought 10 per cent stake in the Offshore Area 1 from Videocon Group for USD 2.475 billion. This stake was later divided between OVL and Oil India Ltd in 60:40 ratio.

The proceeds were used to repay bank loans in India and abroad.

The group has also decided to merge its direct-to-home business to Dish TV. It had also sold its spectrum in six circles for a consideration of Rs 4,428 crore to telecom major Bharti Airtel.