Salzer Electronics Ltd. — M&A Activity 2019

May 24, 2019

Media Release

Salzer Electronics Limited, INR 550cr revenue Coimbatore based company, acquires 72.32% stake in Kaycee Industries Limited (part of CMS group), a pioneer in Industrial Switches for more than 75 years

• a Strategic acquiiiticn in line with company: iccui tc itrengthen Salter: pmitinn in the induitrial Switchgear market by increaiing iti product offering and expand it: footprint in Railway huiinen, manufacturing iet up in weitern india and acceai to all india dealer network.
• . Acquilitinn to aid Salter expand it: pretence intc Electrical Equipment rector.
• . Lait few yeari, hcmegrcwn CMS group, being leading player in IT/ ITES , Tramc Signaling Calh Management, E-Gnvernance, Surveillance etc hi! heen churning iti pnrtlnlin cf hulinenel. in the part the group icld ccntrclling itake in their Calh Management hulinen tc huy-cut fund Black-Stone and now with Baring Alia.
• . Categorixed il Ncn-ccre hulinen, CMS Group agree: to exit Kaycee induitriei Ltd which wil acquired by CMS in 2002 from Bajaj Electricali.
• . Singhi Advimrl, a glchal lnveltment hanking nrm, iccuued cn mam, acted in an exclulive advimrl tnthetrinlininn.

Ccimhatcre, May 2A", 2019: Salzer Electronics Limited (ESE: 517059, iiSE: SALZERELEC), among leading players offering total and customised electrical solutions, today entered into a definitive agreement with the promoter (CMS Group) of l<aycee to acquire is stake of 72.32% in l<aycee industries Limited in an all cash deal, and make an additional offer to purchase 25% from public for an total Equity Value of iiiR 22 crores. Salzer Electronics has adequate financial flexibility to fund this transaction. The acquisition is subject to inter alia receipt of necessary regulatory approvals and satisfaction of otherconditions as specified in the offer documenu.

Mumhai hased global investment Bankingfirm, Singhi Advimrl, focussed on niche domestic and cross border M&A'S acted as sole advisor to both CMS & Salzer. incidentally, Singhi Advisors also advised CMS Group when theyfirst acquired i<ayceefrom Bajaj Electricals in 2002.

i<aycee industries Limited, a "pre-independence" company with a legacy of "three quarter of a century", heing pioneer in industrial Switchgear, was controlled by homegrown CMS group which is one of the largestiT/ iTES 2; Enterprise solution firms in india.

Having is corporate office at Mumhai and manufacturing unit at Amhernath near Mumhai, l<aycee's principal products which include Rotary Switches, Rotary Cam Switches, Micro and Toggle Switches, Weadter Tight Switches, Breaker Control Switches, Counters and Fuse Eittings adds to Salzer's attractive productofferings making itcomplementary & synergistic to the existing line of business. This will also strengthen Salzer's position in industrial Switchgear segment which constitutes "42% of Salzer's current revenue and help Salzer expand is footprint into Railways, access to all india dealer network and manufacturing set up in western India.

SALZER ELECTRONICS LTD. EEIZEI"

Going fonuard, l<aycee lndustries Limited would continue to remain a listed entity and both the Companies would share technological support a; knowahow with each other especially in the niche product offerings of the industrial switchgear a; other allied business segments. The resulting synergies from this acquisition would benefit both the Companies on the hack of enhanced productportfolio and access to a largerclient hase.

Commenting on thit development, Mr. R. noraiawamy, Managing Director, Salter Electronic: Ltd taid:

"i am happy ta share that we have entered inta a defini' 've agreement with pramaters of Kaycee industries ta acquire 72.32% stake in the Campany. Kaycee being pianeers in the cam aperated ratary switch wiii heip aur Campany/urther ta increase aur market share in the industriai switchgear industry and cansaiidate aur market ieadership in this niche praduct. This acauisitian is in iine with aur strategy of strengthening and grawing aur suite afproducr offerings. The resuiting synergy wauid enable us ta penetrate further inta the market an the back of enhanced praduct offerings. We expect that this strategic acauisitian ta enable us ta generate iang term value/or aii aur stakehaiders.~

About Siller Elenrnniu Limited

• Salzer is a Leading player offering Total and Customized Electrical Solutions in Switchgears, Wires & Cables and Energy Management business. it is the largest manufacmrer of CAM Operated Rotary switches a Wire Ducts in lndia, with a market share of 25% a 20% respectively. The Company caters to a wide range of producs with five lnrhouse manufacturingfacilities, located in Coimbatore and Himachal Pradesh
• The Company has a wide distribution network locally and globally, exporting to more than 40 countries. in lndia, Salzer markets is products through is own distributors and more than 350 local distributors of L&T. The Company has a strong R&D team that focuses on developing and commercializing the technologies of the products, and as a result, can offer total customized electrical solutions to its customers.

About Kaycee lndunriel Limited

• l<aycee industries (ESE: 504084), is a leading provider of electrical and electronic components in lndia and has a history of more than 75 years. The Company has been leading the electrical industry by way of consistent quality performance in the switches market along with development of existing and new products as per the applications. Companies manufacturing facility is located at Amhemath, Thane and employs highly motivated and skilled workforce to deliverquality products as per customers requirement.
• l<aycee's principal products are Rotary Switches, Rotary Cam Switches, Micro and Toggle Switches, WeatherTight Switches, Breaker Control Switches, Counter and Fuse fitting, etc. All is products are as per international and lndian Standards like RC5, DEF, JSS and ISS. The company clocked revenue of lNR 25 crores in FY18 and lNR 20 crores for9m mg.

SALZER ELECTRONICS LTD. EEJZEFI

C IN: L03210'IZ1985 PLC001535

Forlunher inlortnnion, plane comm:

Mr. Bilkiriluhriminiim	Ms. 5:inMr. 5mit ShahMingle]
Salter Electronic: Ltd.	Bridge Inventor RelifinmPvt. Ltd.
Email: haskarasuhramanianfisalzerzmumom	Email:savlifihridzerirmomsmitfihridzerirxom
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Cami on Concerning Forward- Looking Statements:

Int-s document rna/aaes aenarn forwardr/ookr'ng statements. Tnese statements are aasea an management's current expectatrans orbe/r'efs ana aresubject ta anaenarnty anaananaes rn cr'rcumsmnces.Acma/ results may vary maten-auy from tnase expressed or rmp/rea by tne statements nenern aae ta ananaes rn eaanamra, aasrness, aampet 've, teanna/aaraa/ and/or regu/amry factorx. rne Company rs under na aa/raatran ta, ana express/y disc/aims anysaan aa/raatran ta, update or char r'tsfoNI/ardr/ookr'ngstatements, Wnetnet as a tesa/t ofnewr'nforman'on,fumre events, atatnetwrse.