GMM Pfaulder: A Big Fish In A Small Pond
3 min read
Pfaulder, is the world’s leader in Glass Lined Equipment and GMM occupies the same position in India with a 65% market share in the Glass-lined Equipment market. GMM, formerly Gujarat Machinery Manufacturers Limited was incorporated in India on Nov 17th, 1962, by Late Shri Jethabhai Patel. Since then, GMM has been walking on the street to acquire or collaborate with other companies.
Recently, GMM Pfaulder is set to acquire majority stake in parent firm, Pfaulder group from PE firm Deutsche Beteiligungs AG (DBAG) for $27.4M.
- With this acquisition GMM Pfaulder would get control over the technology, as well as $280M business spread across the globe
The acquisition is proposed to be done through GMM international, a new company to set up in Luxemburg
- GMM Pfaulder with 54% (34.4% directly and 19.6% via Mavag AG) which could value both at $27.4M
- Patels- 26% taking the value at $13.2M
- DBAG- 20% at $10.2M
With this acquisition GMM will become the world leader in corrosion-resistance technologies, systems, and services with 12 manufacturing facilities across 8 countries and 4 continents and employing around 1,500 people
Pfaulder Inc, USA was established in 1884, World-leading process solutions company, providing technologies, solutions, services, and innovations to meet the specific requirements of its customers in the chemical, pharmaceutical, and other process industries
Pasts acquisitions and collaboration:
During 1969, GMM inspite of having its own technology decided to produce more technological products and collaborated with NIKES hunger of glass line equipped for 5 years which ended in 1974. In 1987, Pfaulder Inc, first entered GMM with a JV of 40% of the equity of the company which then raised to 51% in 1999, which led to ‘GMM Pfaulder limited’
- Company also had technical knowhow agreement with Chewier Inc, USA for Mfg of certain chemical process equipment’s which ended on Feb 28, 2004
In 2008, acquired Mavag AG, Switzerland based company which led to their highly engineered filtration and drying equipment and mixing systems to the pharmaceuticals, biotech, and fine chemicals industries. In 2012, Parent Pfaulder Inc, USA was acquired by National Oilwell Varco (NOV) of France and sold to PE firm Deutsche Beteiligungs AG (DBAG) 2 years later
In April 2019, it acquired the Industrial Mixing Solutions Divisions of Sudarshan Chemical Industries Ltd, Pune with the brand now called as ‘MIXION’- the market leader in the Industrial Mixing space
In June 2020, French based company, De Dietrich Process System India Pvt Ltd Hyderabad facility was acquired for €6.25M (Rs 53Cr) which gave access to ready- made Glass Lined Equipment manufacturing capacity
Segment wise Revenue contribution FY 19-20
- Glass Lined Equipment- 69%
- Heavy Engineering- 10%
- Mixing systems- 10%
- Engineered system- 3%
- Filtration and Dying- 8%
Domestic business consists of 90% with rest 10% to International marke
A little in the market have heard about GMM Pfaulder, but with the soaring stock price from its 6 months low from Rs 1817/ piece on 19th March 2020 to 52 week high on 12th Aug at Rs 6900/ piece, gaining 279% in 6 months, has been now the talk of the town.
Q1 2020 Consolidated Financials:
- Net profit- 8.5% rise to Rs 19.19Cr
- Net Revenue- 2.77% YoY growth to Rs 154.43Cr
- Net profit margin- 12.43%
- EBITDA- Down by 0.36% YoY to Rs 27.49Cr
- Exactly 50% of its revenue coming from Glass Line Equipment and rest contribution coming other segments
GMM Pfaulder, under its internal program UDAAN is targeting a revenue of Rs 1000Cr by 2023and Rs 1300Cr by 2025. Will we see more acquisitions from GMM Pfaulder in the coming years?
