Publicly listed utilities and water treatment company VA Tech Wabag Ltd has sold the bulk of its stake in a Namibian joint venture to its partner, which is an arm of a French multinational company also focused on the utilities space.
In a stock exchange filing, Chennai-based VA Tech said it had sold 58% of its stake in Ujams Wastewater Treatment Company (Proprietary) Ltd.
It has sold the stake to its partner in the joint venture, Veolia Eau - Compagnie Generale Des Eaux, which is part of Veolia Environnement SA, a French multinational that is involved in water services, waste management and energy utility.
VA Tech said it has sold the 58% stake to Veolia Eau for 78.3 million Namibian dollars ($4.35 million or Rs 33 crore at current exchange rate).
Prior to this transaction, the Indian company held a 66.4% stake in the joint venture; after the deal, 8.4%.
“As part of the Wabag Group strategy to remain asset-light, the management of Wabag Austria decided to transfer its majority stake in the subsidiary,” VA Tech Wabag said in its filing.
The joint venture, with a net worth of Rs 27 crore, had reported revenues of Rs 31 crore for the financial year ended March 2019.
Shares of VA Tech ended Wednesday’s trading session down 4.89% at Rs 78.70 apiece. Markets are closed on Thursday owing to Ram Navami.
According to the official website, VA Tech provides water solutions for municipalities and industries, including services such as water treatment, desalination, wastewater treatment and water reclamation.
It also provides services through a life-cycle partnership, which includes operation and maintenance and the build-own-operate-transfer (BooT) model.
The company reported consolidated net sales of Rs 2,780 crore and profit after tax of Rs 86 crore for the financial year ended March 2019.