Amber Enterprises to Acquire AmberPR Technoplast via Slump Sale

Amber Enterprises India Limited, a leading manufacturer in the consumer durables and air conditioning space, has informed the stock exchanges about its strategic decision to restructure its business operations. On September 7, 2024, the Reconstruction Committee of the Board of Directors of Amber Enterprises approved the acquisition of its wholly-owned subsidiary, AmberPR Technoplast India Private Limited, through a slump sale. 

AmberPR Technoplast India Private Limited (AmberPR) is engaged in the business of producing cross-flow fans and plastic parts, fans and fan guards for outdoor units of room air conditioners, as well as plastic parts for other industries. AmberPR operates within the consumer durables segment of Amber Enterprises. 

The acquisition will be executed through a slump sale on a going concern basis, with the lump sum sale consideration to be determined at the time of closing. The sale will not assign values to individual assets and liabilities, adhering to the guidelines under the Income Tax Act, 1961. A Business Transfer Agreement (BTA) will be drawn up to formalise the acquisition, subject to necessary approvals from regulatory and statutory authorities.

The slump sale is expected to be completed by September 30, 2024, contingent on receiving shareholder approvals and meeting other preconditions outlined in the BTA. The restructuring aims to streamline the company’s operations by merging AmberPR’s business with Amber Enterprises. 

This internal restructuring initiative is expected to bring several advantages to Amber Enterprises:

• By integrating AmberPR’s business, Amber will be able to optimise its resources, resulting in financial and commercial benefits.
• The consolidation will allow for the optimisation of business processes, improving operational efficiency within the company.
• The acquisition will facilitate a more accurate and profound comparison with industry peers, allowing Amber to better benchmark its business performance.
• Merging AmberPR’s business with Amber will give the latter more flexibility to expand its presence in the B2B market.

This move aligns with Amber Enterprises’ broader growth strategy and positions the company to remain competitive in both the consumer durables and B2B markets. Through this restructuring, Amber aims to achieve financial, commercial, and operational ease while enhancing its capacity to expand in the future.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.