Action Construction Equipment Limited has informed the Exchange about Intimation of approval for execution of Business Transfer Agreement (BTA) with ACE KATO PRIVATE LIMITED (a 50:50 Joint Venture Company as per Investment and Shareholders Agreement (ISA)
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ACE's Board has approved transferring its Heavy Cranes Business (truck cranes, crawler cranes, rough terrain cranes) to ACE KATO Private Limited via a Business Transfer Agreement on slump sale basis as a going concern. The Heavy Cranes Business contributed Rs. 85.77 crore revenue in FY 2024-25, which is 2.58% of ACE's total standalone revenue of Rs. 3,320.32 crore. The JV company (incorporated March 2026) is currently 99% owned by ACE and will be restructured to 50:50 with Japan's KATO Works Co. Ltd. upon closing. The transaction qualifies as a related party transaction and is being conducted at arm's length. Expected completion is on or before June 30, 2026. Consideration will be paid via issue of ACE subscription shares by the JV company.
This transfer removes a relatively small but specialized business segment from ACE's standalone operations. Shareholders may see minor revenue reduction, but the move positions ACE to leverage KATO's global crane expertise through the JV structure. The deal is structured as a related-party transaction at arm's length, reducing governance concerns.