Ramkrishna Forgings sells 100% stake in hospitality arm to Yatra online for Rs 129 Cr

Stake Sale: Ramkrishna Forgings, the leading supplier of rolled, forged, and machined products, reported on Monday that it has executed a Share Purchase Agreement for the proposed sale of its entire 100 per cent stake in its Wholly Owned Subsidiary Globe All India Services Limited to Yatra Online Limited. The deal valued at ₹129 crore net of debt is expected to close this quarter.

Globe All India Services has rapidly grown into a major hospitality management player, with an array of service offerings that comprise Corporate Travel, MICE (Meetings, Incentives, Conferences, and Exhibitions), Leisure, and Car Rental services. This transformation was highlighted in the company's regulatory filing, with the firm stressing the subsidiary's growth and position in the market.

On the sale, the MD of Ramkrishna Forgings Ltd, Naresh Jalan, said, "In line with our strategic product rationalisation exercise, we have decided to focus on the core business segments, viz. forged, machined, and fabricated products for industries like Automotive, Railways, Oil & Gas, and Power, wherein we see much more potentiality for growth and expansion, as a part of our long-term objectives. Accordingly, this divestment will facilitate our efforts in consolidating our Balance Sheet.".

Jalan also thanked the team at Globe All India Services for their work in trying to divide a successful business: "This division was created to meet market needs at that time, and its success speaks volumes about commitment and hard work by our fine team. As this business passes into new hands, we would like to take this opportunity to thank all who helped to grow it," he added.

According to Ramkrishana Forgings, cash generated from sales will be used for deleveraging and further strengthening the balance sheet of the company. The company reiterated and assured their shareholders that they are in a very secure position regarding their commitment to long-term growth in their key businesses, along with value creation for all their stakeholders.

The deal is expected in this quarter itself and forms a key movement in the strategic refocusing of Ramkrishana Forgings.