New Delhi: India's first multinational in water treatment business VA Tech WABAG on Friday said it will aggressively pursue global acquisitions to grow faster and has the capability to muster over Rs 2,000 crore for the purpose.
"With this kind of resource base we can acquire a major firm in the business... possibly the fourth or fifth largest player... We have asked our bankers to pursue such prospects," VA Tech WABAG Managing Director Rajiv Mittal told reporters.
"We are looking for buyout that will give us new technology, or it should open for us new geographies. These are the two criteria," Mittal added.
He said the company has hired Rothschild and Merrill
Lynch as investment bankers for acquisitions.
VA Tech WABAG has German and Austrian roots, but its
Indian operations were bought over by a set of professionals
with the backing of ICICI Venture. Besides India, the company
has presence in Europe, Africa and the Middle East.
"We are the fifth largest player in water business
globally. By 2015, we will be number three company globally,"
Mittal said.
On the sources of funding for the acquisition, Mittal,
who is the single largest equity holder in the Rs 1,100 crore
revenue company, said, "We are a debt free company and are now
sitting on a cash pile of Rs 300-350 crore.... Add to this the
profits during the current fiscal and other resources that we
can leverage from..."
Mittal said WABAG, which is technology-driven and
holds around 100 patents, has RoI (Return on Investment) of
around 25-30 per cent and a net profit of 5-7 per cent.
He said the company, which is primarily focussed on
treatment of drinking water and waste water, derives almost
half of its revenue from overseas markets.
Mittal said WABAG is looking at expanding operations
mainly in the emerging markets as the major growth in the
segments it plays in comes from these countries.
He said the company is looking at increasing its
footprint through global acquisitions mainly in these markets,
and ruled out any near term buyouts in India.
PTI
First Published: Friday, December 04, 2009, 12:56