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Schneider acquires Zicom security biz |
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Schneider Electric has signed an agreement with Zicom Electronic Security Systems to acquire the assets of the latter's electronic security systems integration business, namely Building Solutions Group and Special Projects Group. The business recorded revenues of approx. €30 million in fiscal 2009 and has a headcount of about 200. The transaction excludes Zicom's other group companies, such as the retail business and Dubai-based joint-venture. The acquisition is valued at Rs 225 crore.
As per the terms of the agreement, Zicom will transfer 185 employees from its electronic security systems business to Schneider Electric. It will transfer work in progress order book of worth Rs 80 crore to Schneider Electric.
According to the duo, while the security market in India is estimated to be Rs 1,400 crore, it is poised to grow at 20 per cent rate in coming years. The Zicom's business acquired by Schneider Electric has grown at an average of 30% per cent in last 5 years. Schneider Electric India plans to quadruple the domestic turnover and double the market share in India by 2013.
Zicom's business acquired by Schneider Electric stands at Rs 179 crore (un-audited results) as of December 2009. On the other hand, Schneider Electric India's domestic sales stood at Rs 2,000 crore last year in addition to Rs 2,000 crore from exports.
The completion of the transaction, subject to conditions precedent and Zicom shareholders' approval, is expected to occur in April 2010. This acquisition meets Schneider Electric's Return on Capital Employed criteria.
Chris Curtis, Executive Vice-President, Buildings Business, comments: "By combining Schneider Electric's complete solution offerings, including Pelco's world leading video security offers, with the strong execution capabilities, deep market knowledge and impressive customer reach of Zicom, we expect to attain leadership in India for fully integrated building management systems. In parallel, we will keep serving with great dedication our system integrator partners in India."
Olivier Blum, Country President, Schneider Electric India, comments: "This acquisition reaffirms our ambition in India and represents another major milestone after the integration in 2009 of Conzerv Systems and Meher Capacitors, leaders in energy efficiency. Security and energy management are among India's top challenges and fastest growing markets. After the transaction, Schneider Electric will be in an even stronger position to capture these opportunities with the support of its 8,000 employees."
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