SEPC shares declined 1% to ₹6.6 on Wednesday, July 8, following the company's announcement of board approval for the proposed acquisition of up to 90% equity stake in Avenir International Engineers and Consultants LLC, Abu Dhabi. According to Business Standard, the stock is currently trading 1% lower as investors digest the strategic development. The decline comes despite the company's positive long-term prospects from this international expansion move.
The acquisition will be undertaken through a share swap transaction involving a preferential allotment of 153 crore equity shares of SEPC at an issue price of ₹10 per share, aggregating to ₹1,530 crore. As reported by Business Standard, this represents a premium of 51% from current market levels, indicating the strategic value of the transaction. The transaction will be completed without any cash outflow and is expected to conclude by December 2026. The proposed acquisition is estimated to strengthen SEPC's capabilities in the oil and gas sector and significantly enhance its presence across West Asia.
Avenir International Engineers and Consultants LLC was established in 2011 and serves as an engineering and design company for the oil & gas and other civil infrastructure sectors in the UAE. The company holds established qualifications with Abu Dhabi National Oil Company (ADNOC) and reported a turnover of approximately AED 75.01 million during 2025. According to Business Standard, this acquisition will strengthen SEPC's capabilities in the oil and gas sector and significantly enhance its presence across West Asia.
In addition to the acquisition, the Board has approved an increase in the Company's Authorised Share Capital from ₹225 crore to ₹600 crore, through the creation of additional equity shares, subject to shareholders' approval. As reported by Business Standard, the Board has also approved enhancing the limits under for loans, guarantees, securities and investments to ₹3,000 crore, providing the Company with greater financial flexibility to pursue future growth opportunities. The company will also seek shareholder approval to increase borrowing limits by ₹7,500 crore, raising future leverage and dilution considerations despite the strategic benefits.
Despite the positive strategic development, SEPC shares are down 34% so far this year, highlighting the challenging market conditions facing the company. However, the company reported FY26 net profit of ₹53.50 crore, more than doubling year on year, as reported by BingX. In the latest quarter, SEPC's consolidated net profit jumped 37.03% to ₹13.73 crore on a 132.45% surge in revenue from operations to ₹273.83 crore in Q4 FY26 over Q4 FY25, as reported by Business Standard. This strong financial performance provides a solid foundation for the Avenir acquisition and demonstrates the company's ability to execute strategic growth initiatives despite current market headwinds. The acquisition represents a significant step in SEPC's international expansion strategy, with the company positioning itself for enhanced capabilities in the Middle Eastern oil & gas sector.
