Carborundum Universal Limited to Wind Down German Subsidiary
Carborundum Universal Limited (CUMI) announced that CUMI International Limited, Cyprus (CIL), its wholly-owned subsidiary, has approved the initiation of a voluntary winding-up process for CUMI AWUKO Abrasives GmbH, Germany (CAAG). CAAG, previously M/s. AWUKO Abrasives Wandmacher GmbH & Co. KG, was acquired in February 2022 through a step-down subsidiary. The subsidiary manufactures coated abrasives for wood and leather applications.The decision to wind down CAAG follows continued underperformance, mounting losses, and challenging market conditions. Factors contributing to the difficulties include product and market limitations, intensified price competition, global overcapacity, and geopolitical and macroeconomic challenges impacting input costs. Despite prior turnaround plans and investments, CAAG has not shown signs of recovery.
CAAG’s turnover for the financial year ended March 31, 2025, was Rs. 93 crores, representing 1.9% of CUMI’s consolidated revenue. The subsidiary’s net worth stood at Rs. 74 crores.
The likely financial impact from the winding down of CAAG is estimated to be between Rs. 110 crores and Rs. 130 crores. This estimate is subject to change based on the realization of assets and other obligations.
CUMI stated that CAAG is not a material subsidiary and the winding down is not expected to adversely affect the company’s business. The liquidation process will adhere to applicable laws in Germany.
| Particulars | ||
|---|---|---|
| a. | the amount and percentage of the turnover or revenue or income and net worth contributed by such unit or division or undertaking or subsidiary or associate company of the listed entity during the last financial year; | CAAG is a wholly owned subsidiary with 100% of its share capital being held by M/s. CUMI International Limited, Cyprus (CIL), a wholly owned subsidiary of the Company. Turnover of the subsidiary for the financial year ended 31 st March 2025 is Rs. 93 Crores (1.9% of the consolidated Revenue of the Company). Net worth - Rs. 74 Crores |
| c. | the expected date of completion of sale/disposal | CAAG would be initiating the process for voluntary winding up. The timeline will be subject to the laws and formalities in Germany. |
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