Shares of Pitti Engineering Limited were trading in the red and 3% lower on 12 March after the company announced acquiring a 100% stake in Bagadia Chaitra Industries.

In its regulatory filing, the company announced that they have signed an agreement with Bagadia Chaitra Industries Private Limited and its shareholders to acquire 100% stake at an enterprise valuation of Rs 124.92 crore.

The company added that the cost of acquisition will arrive by adjusting the said enterprise value for the net debt and working capital changes on the closing date, which is subjected to other adjustments that are mutually agreed between the parties.

As part of the overall consideration, the company will inject around Rs 40 crore as funding into Bagadia Chaitra Industries on the closing date to repay their existing debt.

Bagadia Chaitra Industries manufactures electrical laminations and aluminium die-cast rotors for AC/DC motors, pumps, home appliances, alternators, electric vehicles, and more. They have a strong geographical exposure in the South Indian market. Their manufacturing facilities are located in Tumkur district and have an installed capacity of 18,000 tonnes annually.

At 12:46 pm, the shares of Pitti Engineering were trading 2.42% lower at Rs 732.45 on NSE.