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Auto component maker Lumax Auto Technologies on Saturday said its proposed acquisition of OK Play Group’s roto moulded plastic business for around ₹150 crore has been put on hold due to coronavirus pandemic.
Due to unprecedented pandemic situation and extended lockdowns disrupting business continuity, the proposed acquisition is being put on hold, pending further review and appropriate decision in future, Lumax Auto Technologies said in a regulatory filing.
Earlier in February this year, the company’s board had approved the deal to provide Lumax Auto Technologies Ltd (LATL) access to latest rota moulding technologies.
The company had said that the initial purchase consideration would be based on an enterprise value that will be EBITDA (earnings before interest, taxes, depreciation and amortization) multiple of 5.67 times, to be applied on 3 years average EBITDA of 2017-18, 2018-19 and 2019-20 of the auto component business of OK Play.
The auto component business of the OK group had a revenue of ₹42.9 crore and EBITDA of ₹9.6 crore in 2016-17, ₹109.6 crore and ₹34.1 crore, respectively, in 2017-18,. The same for 2018-19 stood at ₹125.8 crore and ₹38.3 crore.
The balance 10 per cent consideration was to be computed and paid based on six times of 2022-23 EBITDA of the acquired auto component business by July 31, 2023, subject to certain adjustments in accordance with definitive agreements to be entered into by the company.
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