India's Crompton Greaves on Saturday signed a contract to purchase stakes in Ganz Transelektro Villamossági Rt (GTV), which exercises ownership rights over many of the assets of troubled Hungarian holding company Transelektro.
Crompton Greaves paid €35 million for the company and agreed to take over Ft 12 billion-Ft 13 billion of its bank loans, the sellers announced on Saturday. GTV was estimated to have bank loans, including interest, totaling Ft 15 billion in April, and the company is thought to have many more liabilities to suppliers.
Crompton Greaves bought the stakes through its Belgian unit Pauwels from the Hungarian Development Bank Rt (MFB), Vegyépszer Rt, Resonator Kft and Közgép Rt. Under the contract, Pauwels is to pay the purchase price and repay loans within 60 days, including Ft 1.2 billion of a Ft 3 billion bridging loan backed by a 75% state guarantee taken out in May, while Vegyépszer, Resonator and Közgép will return Ft 1.8 billion from the loan.
Crompton Greaves will acquire GTV's energy and transformer units under the contract. At the same time, GTV's power plant unit and its transportation unit were acquired by TFSZ, a company set up by Vegyépszer (20%), Közgép (20%) and Resonator (60%).