Rane (Madras) Limited has entered into a Business Transfer Agreement with Hindustan Composites Limited to acquire the latter's Friction Business Undertaking as a going concern on a slump sale basis for a lump sum cash consideration of ₹370 crore. The transaction, approved by the Board of Directors on June 30, 2026, is expected to close by the end of the second quarter, subject to customary closing conditions. This strategic move is designed to establish Rane (Madras) as a market leader across all major segments of the automotive components industry by creating a friction materials business with an aggregate revenue of over ₹1,000 crore.

Financial and Operational Impact

The acquisition includes the transfer of assets, liabilities, contracts, licenses, and employees associated with the friction business. For the financial year ended March 31, 2026, the Hindustan Composites Friction Business reported a turnover of ₹315.04 crore and a Profit Before Tax (PBT) of ₹40.29 crore. This unit contributed 84% of Hindustan Composites' total turnover of ₹375.01 crore for the same period. The deal is structured on a cash-free and debt-free basis, with the consideration payable upon closing, subject to adjustments specified in the agreement.

The following table summarizes the key financial metrics of the acquired business:

Strategic Rationale and Synergies

Management stated that the acquisition leverages Rane (Madras)'s established leadership in the friction business, which currently spans passenger vehicles, two-wheelers, aftermarket, and railways. The transaction is expected to unlock substantial operational synergies through manufacturing scale, an expanded distribution network, and enhanced R&D capabilities. Additionally, Rane (Madras) acquires the "COMPO" brand, reinforcing its leadership position and expanding its reach across distributors, fleet operators, and aftermarket channels.

Transaction Details

The agreement includes non-compete and non-solicit restrictions on the parties post-closing. The transaction does not fall under related party transactions and is being executed outside a scheme of arrangement. The target entity operates two manufacturing facilities in Paithan and Bhandara, Maharashtra, and has over six decades of experience in the sector.

Rane (Madras) Limited has appointed Ramkumar Lakshminarayanan as an Independent Director, effective July 01, 2026, subject to shareholder approval at the ensuing 22nd Annual General Meeting. The Board approved the proposal based on the recommendations of the Nomination & Remuneration Committee. The appointment is valid for a term ending April 08, 2031.

Ramkumar Lakshminarayanan (DIN: 00090089) holds an MBA from IIM Ahmedabad and possesses over three decades of experience in senior corporate roles. He currently serves as an Independent Director on the boards of Igarashi Motors India Ltd., Wendt India Ltd, and Ambadi Investments Limited. Additionally, he is the Acting Chair and Member of the Board of Governors of IIM Bodhgaya and a member of the Executive Committee of The Chennai Angels network.

Prior to this appointment, Lakshminarayanan retired as Managing Director of Tube Investments of India Ltd in August 2018 after a tenure of over 10 years. His career spans 25 years in leadership positions, including roles as CFO and business head across sectors such as bicycles, auto industry supply chains, industrial products, and telecom cables.

The Director has affirmed that he is not debarred from holding the office by virtue of any SEBI Order or any other authority. There are no disclosed relationships between the directors of the company. The Board meeting commenced at 17:30 hrs and concluded at 18:22 hrs IST on June 30, 2026.

Appointment Details