Rane (Madras) Limited (RML) has entered into an agreement with Hindustan Composites Limited (HCL) to acquire its Friction Business as a going concern on a slump sale basis for an enterprise value of Rs 370 crore, equivalent to Rs 3.70 billion, subject to the terms of the agreement.

HCL’s Friction Business is a leading supplier of friction materials, with over six decades of experience across the automotive, railway, farm tractor and industrial sectors. Its product portfolio includes brake linings, brake pads, brake blocks, clutch facings and industrial friction products, supported by in-house R&D and a pan-India distribution network.

The business operates two manufacturing facilities in Paithan and Bhandara, Maharashtra. Based on the latest audited financial results, the Friction Business reported revenue of Rs 315.04 crore, equivalent to Rs 3.15 billion, and PBT of Rs 40.29 crore, equivalent to Rs 402.90 million, in FY26.

As part of the acquisition, RML will also acquire the “COMPO” brand, strengthening Rane’s leadership position by expanding its reach across segments, distributors, fleet operators and aftermarket channels.

RML has an established leadership position in the friction business across passenger vehicles, two-wheelers, aftermarket and railways, along with an export business aggregating revenue of over Rs 700 crore, equivalent to Rs 7 billion. This transaction marks a transformative milestone. Upon completion, the acquisition will create a Rs 1,000 crore-plus, equivalent to Rs 10 billion-plus, friction materials business, establishing RML as the market leader across all major segments.

The transaction is expected to unlock substantial operational synergies through manufacturing scale, an expanded distribution network and enhanced R&D capabilities. The expanded footprint is expected to serve as a critical launchpad for future business expansion.

Harish Lakshman, Chairman, Rane Group, said, “This acquisition leverages Rane’s ability to create a market-leading friction solutions platform. By integrating these complementary businesses, we are uniquely positioned to address the evolving needs of India’s transportation needs while driving operational excellence and long-term value for our stakeholders.”

The transaction, executed through a Business Transfer Agreement, remains subject to customary regulatory approvals and closing conditions. It is expected to be completed by the end of the second quarter.