Ag Growth International Inc. (AGI) has entered into binding purchase agreements to acquire 100% of the outstanding shares of Milltec Machinery Limited for $109.5 million, plus the potential for up to an additional $38.4 million based on the achievement of EBITDA1 targets.
Headquartered in Bangalore, India, Milltec is a manufacturer of rice milling and processing equipment in India. The company has 400 full-time employees and operates four production facilities in India, three of them in Bangalore, and one in Chennai.
Ravindranath Ramaiah and Rajendran Joghee founded the company in 1998 and each have over 25 years of experience in the rice milling equipment industry. They will continue to provide leadership and vision to Milltec going forward in their roles as managing directors of the company.
Over the past few years Milltec has also bolstered its management team with the addition of two very experienced individuals, Rajan Aggarwal, CEO, and Ganapathy Subramaniam, CFO.
Completion of the transaction is subject to customary conditions precedent and is expected to close prior to March 31, 2019.
“This marks the beginning of a new chapter for AGI as we establish our platform in a large and rapidly growing market and region," says Tim Close, president and CEO of AGI. "Milltec is a launching pad for AGI in India and the broader Asian region with a complete product line for rice as well as providing the manufacturing, design, engineering, service and installation capabilities that AGI will leverage across our current product lines."
"This comprehensive platform brings a talented management group, excellent manufacturing facilities, pan-India distribution and service teams, as well as turn-key systems capabilities," said Close. "A perfect fit with our 5-6-7 strategy. Ravindranath and Rajendran have built a great business based on quality products, efficient operations and a dynamic culture that continuously strives to develop new products and provide the highest level of service to their customers. We are proud to welcome Ravindranath, Rajendran, Rajan, Ganapathy and the entire Milltec team to the AGI family.”