Hyderabad: City-based technology major Cyient has signed an agreement on divesting its 49 per cent equity in joint venture firm Infotech Aerospace Services Inc (IASI) to its partner Pratt & Whitney, a division of United Technologies Corporation. Infotech Aerospace is a 51:49 joint venture between Pratt & Whitney and Cyient. Set up in 2013 in Isabela, Puerto Rico, IASI JV offers aerospace defence design, development and related services, primarily to United Technologies and its business units.

This is the second divestment post the sale of Infotech Enterprises IT Services as part of our strategy to exit the IT services business. We will continue to evaluate and rebalance our business portfolio – Krishna Bodanapu CEO & MD

Cyient CEO and MD Krishna Bodanapu said this divestment was a step in the right direction and would aid the company in becoming more focused striding towards achieving this vision.

Cyient said in a communique to BSE that the consideration received from this transaction was $1.8 million, post-additional dividend disbursement of $9.1 million from the cash reserves. “The transaction would be EPS (earnings per share) neutral. The closing of the transaction is subject to regulatory approvals and customary closing conditions,” it added.

As a Design, Build and Maintain partner, Cyient takes solution ownership across the value chain to help clients focus on their core, innovate, and stay ahead of the curve.

Bodanapu said: “We have been exiting the non-core businesses. This is the second divestment post the sale of Infotech Enterprises IT Services (IEITS) that we did in October 2015 as part of our strategy to exit the IT services business. We will continue to evaluate and rebalance our business portfolio”

Cyient shares were down Rs13.90 or 2.64 percent and closed at Rs512 on BSE. Pratt & Whitney’s aircraft engines are used in civil as well as military aviation. IASI contributed to Rs11.8 crore to Cyient’s profit after tax (PAT) in FY2017, the filing said. Its total net profit was Rs 236.90 crore in the said fiscal.

Cyient had recently announced that its step down subsidiary, Cyient Defense Services Inc, US has signed a definitive agreement to acquire 100 per cent equity in B&F Design Inc (based in Connecticut, US) in an all-cash deal. The transaction is aimed at further strengthening automation in Cyient's key vertical -- aerospace and defence -- in line with strategy for growth.

B&F Design's revenues are between $8-9 million and they have 47 employees, Cyient had said.The enterprise value of the deal was $5.5 million on a cash-free and debt-free basis, subject to closing adjustments and deferred payment and earn-out based in future performance.

With nearly 14,000 employees in 21 countries, Cyient partners with clients to operate as part of their extended team, in ways that best suit their organization’s culture and requirements.

By Business Bureau