Chennai, May 19 (IANS): In a sale and purchase transaction, Siemens Ltd on Friday said it has decided to sell its low voltage motors and geared motor business for Rs 2,200 crore and buy the electric vehicle (EV) division of Mass-Tech Controls Private Ltd for Rs 38 crore.

According to Siemens, the low voltage motors and geared motor business will be sold to group outfit Siemens Large Drives India Private Limited, an entity wholly owned by Siemens AG.

The sale will take effect from October 1 this year.

The Board of Siemens has also decided to consider the distribution of 100 per cent of the sale consideration as a special dividend, at the first Board Meeting after completion of the proposed transaction.

For FY 2022, the low voltage and geared motor business recorded a Revenue from Operations of Rs 1,061 crore and Profit from Operations of Rs 132 crore.

According to Siemens, the sale transaction is consequent to the intent of Siemens AG to carve out the low voltage motors and geared motors business among others globally into a legally separate company and is based on Siemens AG's decision to form Innomotics, an integrated provider of motors and large drives.

Effective July 1, 2023, the carve-out in Germany will be completed and Innomotics GmbH (Germany) will operate as a legally separate and independent company within the Siemens Group. Siemens AG indicated in a second step to diligently review options regarding the best future ownership of Innomotics.

Such options include a public listing as well as a combination with a strategic partner or long-term oriented financial investor, Siemens said.

Be that as it may, Siemens in order to have a major play in India's fast growing EV charging infrastructure sector has inked an agreement to buy the EV division of Mass-Tech Controls.

According to Siemens, the EV division is engaged in design, engineering and manufacturing of a wide range of AC chargers, and 30 to 300kW capacity DC chargers for various end applications for EVs.

The purchase consideration is Rs 38 crore on a cash free and debt free basis and subject to other adjustments that are mutually agreed between the parties to the transaction, Siemens said.

During FY23, the EV division did a turnover of about Rs 16.7 crore.

Sunil Mathur, Managing Director and Chief Executive Officer, Siemens Limited, said: "This acquisition will enable Siemens Limited to address the rapidly growing Indian e-mobility market by complementing our global portfolio. The acquisition will help us to accelerate our growth plans in the e-mobility business segment and will expand our portfolio of sustainability solutions for our customers."