The deal is expected to value Crompton Greaves at over $ 2.5 billion. Thapar owns 42.7 % of the company, and the entire holding could be up for sale if deal were to be consummated.
“Thapar wants to sell his controlling 42.7 % stake in Crompton Greaves to an overseas company seeking to establish itself in India." said one of the sources.
Hitachi has been aggressive in establishing its presence in Asia's third-largest economy. "Hitachi does not want to be perceived as an air conditioner company in India. In the next five years, Hitachi aims to increase its turnover by 10 times." the second source claimed, requesting not to be identified as the deal is not yet public.
Hitachi operates two subsidiaries in India. It owns a 74 % stake in listed Hitachi Home and Life Solutions (India) Ltd. The group needs to grow outside Japan, particularly in an emerging market like India, facing the challenge of a 3.6 % return on sales.
Source: The Economic Times