Leveraging Existing Strengths & Long-Term Prospects to Attract a Growth Partner
“Through its thorough assessment, strategic understanding and meticulous presentation of our business prospects, PINC helped us in attracting and partnering with a suitable financial partner.”
- Mr. F R Singhvi
Joint Managing Director, Sansera Engineering Pvt. Ltd.
Sansera Engineering, one of India’s leading precision engineering companies supplies critical auto components to Indian and global auto manufacturers. It has carved a niche of its own by becoming a large manufacturer of core engine components such as crankshafts, rocker arms and connecting rods for 2-wheeler and automotive applications. Sansera has also developed a strong aerospace parts manufacturing platform. The company has reinforced its leadership position by being appointed as the single source supplier to many OEMs.
In order to expand its business and leverage opportunities, the promoters wanted to induct equity investors through primary and secondary purchase of equity. However, they were looking for an investment partner who could recognise the tangible as well as intangible assets of their business from a strategic standpoint. The company management wanted the investors to value the strengths of the business, viz. its products and the entry barriers it had created for its products.
PINC prepared a detailed business plan that demonstrated the company’s manufacturing strengths, including its state-of-the-art plants, critical products platform and long-term OEM relationships. It also showcased the potential to create a large scale business growth on the back of new product development. PINC’s expertise in structuring private equity transactions proved to be a strong catalyst in the conclusion of the PE transaction. The investments met the valuation expectations of the promoters in terms of price and transaction structure.
The complex transaction mechanics involved in the transaction was successfully completed to the satisfaction of both the parties. The secondary purchase provided liquidity to its promoters and primary purchase infused sufficient cash in the business for achieving the planned growth; a win-win situation for both – exiting and continuing shareholders.