Varroc to divest 4-wheeler lighting systems operations in Americas, Europe to Omnium for ₹4,830 crore

The divestment is part of VEL’s strategy to align its resources with the high value and high growth primary markets in China, India, and the two-wheeler sector globally.

Varroc Engineering Ltd (VEL), a leading automobile component company, has signed a Securities Purchase Agreement (SPA) with Compagnie Plastic Omnium SE of France to divest its 4-wheeler lighting systems operations in the Americas and Europe for Euro 600 million.

The divestment is part of VEL’s strategy to align its resources with the high value and high growth primary markets in China, India, and the two-wheeler sector globally, the Pune based company said in a filing.

The transaction will see VEL divesting its lighting System operations in the USA, Brazil, Mexico, Poland, Czech Republic, Germany, Turkey, and Morocco.

VEL will also continue to operate its China JV and other international 2-wheeler businesses in countries like Italy and Vietnam and global electronics businesses in Poland and Romania.

The company is retaining its 4-wheeler lighting operations in Asia.

“The planned divestment of VEL’s 4-wheeler lighting systems businesses in the Americas and Europe will ensure enhanced shareholders’ value, sustainable growth, and further development of its R&D facilities and engineering capabilities,” the company said.

Tarang Jain, Chairman & Managing Director, Varroc Engineering said “Our immediate goal is to be future-ready with continued profitable growth in emerging sectors like the EV and high technology electronics.”