Carborundum Universal Ltd (CUMI), a Murugappa Group company engaged in abrasives, ceramics and electrominerals, has infused $3 million (₹28.78 crore) into its wholly owned subsidiary CUMI International Ltd, Cyprus.
The investment has been made through subscription to the equity share capital of CUMI International to meet its funding requirements related to the proposed closure of its wholly owned German subsidiary, CUMI Awuko Abrasives GmbH.
Investment supports German subsidiary closure
CUMI said the investment was made at fair value and is supported by a valuation report. As the transaction is between CUMI and its wholly owned subsidiary, it constitutes a related party transaction.
CUMI International held 100% of the share capital of CUMI Awuko and will continue to hold the entire stake following the investment. No promoter, promoter group or group company has any interest in the entity other than through its shareholding in CUMI.
Awuko acquired from insolvency proceedings
CUMI Awuko Abrasives was established following CUMI’s acquisition of the main assets of German coated abrasives maker AWUKO Abrasives Wandmacher GmbH & Co. KG in 2022. The acquisition included manufacturing assets, brands, patents and technical know-how.
CUMI subsequently undertook a strategic review of the German business after continued underperformance. The company attributed the difficulties to structural and external factors, including product and market conditions, global overcapacity, pricing pressure, geopolitical and macroeconomic pressures and rising energy costs.
Business faced persistent losses
CUMI Awuko reported revenue of €10.5 million in FY26, while its loss after tax stood at €18.6 million, including closure costs, compared with a €10.2 million loss in FY25.
Following the review of its ability to turn around the business, CUMI International decided to initiate voluntary winding-up of the German subsidiary under applicable German laws. CUMI has described the move as part of its broader focus on disciplined capital allocation and portfolio optimisation.