Adani Defence Systems and Technologies Ltd. will acquire an 85.8% stake in Air Works India (Engineering) Pvt., according to a share purchase agreement that was executed on Monday.
Adani Defence Systems is a wholly owned subsidiary of Adani Enterprises Ltd., which intimated the National Stock Exchange and the BSE of this transaction through an exchange filing.
"For us, creating a presence in the maintenance, repair and overhaul sector is more than just a strategic step, it's a commitment to building an integrated aviation services ecosystem that` strengthens the backbone of India's aviation infrastructure," Jeet Adani, director of Adani Airports, said.
This transaction does not fall under related-party transactions. Air Works India is one of the country's largest MRO companies in the private sector.
"Our vision is to deliver a full-spectrum MRO offering—spanning line, base, component, and engine maintenance—to meet the needs of both commercial and defence aviation sectors," Ashish Rajvanshi, chief executive officer of Adani Defence & Aerospace, said. "In a time when atma nirbharta in defence is a national imperative, we stand fully committed to scaling domestic capabilities to serve both our armed forces and the broader aviation sector."
Adani Defence Systems had a similar deal with Israeli defence electronic company Elbit Systems, which had undertaken the acquisition of 44% stake in Atharva Advanced Systems and Technologies Ltd., an Adani Defence unit. on Dec. 14.
Elbit Systems plans to develop and manufacture various autonomous aerial technologies and systems for defence applications.
Share price of Adani Enterprises closed 0.26% lower at Rs 2,338.95 apiece on the NSE, compared to a 0.7% increase in the benchmark Nifty 50. The stock has fallen 17.9% on a year-to-date basis.
All three analysts tracking the company have a 'buy' rating on the stock, according to Bloomberg data.
The average of 12-month analysts' consensus price targets implies a potential upside of 81.9%.
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