Monday, May 16, 2022
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Bajaj Electricals Planning To Rearrange Power Transmission, Power Distribution Businesses Into Standalone Entities

Bajaj Electricals said that it has appointed advisors and consultants to help the board in evaluating the options. It anticipates completion of the process "as soon as practically possible"

Bajaj Electricals Planning To Rearrange Power Transmission, Power Distribution Businesses Into Standalone Entities

Bajaj Electricals informed on Thursday that its board is considering altering its business structure by separating its Power Transmission and Power Distribution businesses into standalone or independent legal entities. The company added the revamping of the corporate structure could be achieved by means of demerger, subsidarisation or strategic partnerships. 

The consumer electrical equipment manufacturer stated that it would appoint advisors and consultants to assist the board in evaluating the options. Bajaj Electricals expects the way forward would potentially be established "as soon as practically possible."

"Considering the varied nature and potential opportunities of each of the business segments and the need for a focused approach to unlock these opportunities, the Board of Directors of the Company has decided that the Company should undertake a comprehensive review of the existing corporate structure," the company stated. 

The company's board mentioned the strategic objectives behind undertaking such an exercise including streamlining its business structure to enhance market positions and work on delivering long-term growth, altering the capital structure and allocation policies based on business-specific dynamics and creating distinct investment profiles to attract deeper and broader investor bases. 

Chairman and Managing Director of Bajaj Electricals, Shekhar Bajaj stated the two businesses in focus had sharpened their operational focus, increased case flows and repaid most of their debt whilst focussing on health and safety and ESG in general. "We believe the time is now ripe to build further on this and review our structures to enable unconstrained business growth for each business segment," he added. 

On Thursday, shares of the company closed 0.65 per cent lower at Rs 1,049.95 on the BSE. On the NSE, it closed 0.68 per cent lower at Rs 1,048.85. 

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