Road construction equipment maker Gujarat Apollo Industries Ltd is picking 26 per cent stake in Credo Mineral Industries Ltd (CMIL) for Rs 13 crore ($2.1 million), as per a stock market disclosure.
Ahmedabad-based public limited firm CMIL is a part of Credo Group which focuses primarily on the mining and minerals sector of India.
With this JV, Gujarat Apollo would be able to expand its existing business segment by adding value to its core focus of manufacturing crushing/screening equipment for the mining and mineral beneficiation industry.
"This move would be a strategic step enabling the company to vertically integrate by entering into the business of minerals, processing, beneficiation, chemicals and further in the field of R&D. Further, this move will help form strategic alliances with strong partners in their respective fields such as CMIL and its JV partner GMDC Ltd," the company said in the filing.
Incorporated in 1967, Gujarat Apollo, the road construction equipment business of Apollo Group, is the leading manufacturer and exporter of road construction equipment in India. The firm designs, manufactures, sells road construction equipment as well as provides product support for equipment such as asphalt batch mix plant, drum mix plant, wet mix plant, jaw crushers/Horizontal shaft impact crushers/mobile crushers and hydraulic & mechanical brooms.
Early this year the group completed the deal with Swiss firm Ammann Group, a manufacturer of asphalt mixing plants, compaction machines and asphalt pavers, to sell majority stake in the consolidated road construction equipment business.
The foreign partner would invest in the core business of the Apollo Group comprising asphalt plants, pavers, curb pavers, bitumen sprayers, compaction equipment, etc.
Gujarat Apollo scrip was quoting at Rs 101.10 per share, down 1.46 per cent in mid-day trades on the BSE in a strong Mumbai market on Tuesday.
(Edited by Joby Puthuparampil Johnson)