Motherson Arm Acquires 50.1% Stake in Rotary Connectors

Samvardhana Motherson International Limited (SAMIL) has announced that its board approved the purchase of a 50.1 per cent equity stake in Rotary Connectors Private Limited (RCPL) by its wholly owned subsidiary, Samvardhana Motherson Adsys Tech Limited (SMAST).

The all-cash deal, at an enterprise value of Rs 5,004 million, is meant to scale the group's aerospace and defence business, particularly in Electrical Wiring Interconnect System (EWIS). The company informed the stock exchanges, and the transaction is subject to conditions precedent.

RCPL's promoters will continue to hold the remaining 49.9 per cent. SMAST will have the right to appoint a majority of directors on RCPL's board.

Financials

RCPL's turnover in FY2026 (unaudited) was Rs 1,235 million, up 20.1 per cent from Rs 1,028 million in FY2025. FY2025 turnover was in turn 36.7 per cent higher than the Rs 752 million recorded in FY2024. Turnover has grown 64.2 per cent over the two years. The enterprise value is about 4.1 times FY2026 turnover.

Equity value will be the enterprise value plus net cash as on the locked-box date of March 31, 2026. It will be adjusted for any leakage or cash withdrawal between that date and closing.

Incorporated on December 8, 2005, RCPL manufactures military-grade circular connectors and interconnection solutions used in aerospace and defence, among other sectors. It operates three manufacturing facilities in Bengaluru.

Rationale and Timeline

SAMIL said Motherson's existing aerospace and defence footprint, geographic reach and customer access can potentially be used to accelerate RCPL's growth.

The transaction is not a related party transaction, and no promoter or group company has an interest in RCPL. No governmental or regulatory approvals are required. Completion is expected by the fourth quarter of FY2027.