BL reported that Gujarat based Elecon Engineering is in talks with a European company for an acquisition seeking to establish a global footprint. It is also looking to expand its material handling equipment and gear box division in the overseas market.

Mr Prayasvin Patel CMD of Elecon Engineering said that "We are looking to buy a company which will be about 60% to 70% of our market cap. The discussions are at an early stage and it would not be fair to elaborate on it." He added that a proposed European foray will give it an established network outside India and a high margin customer base.

Meanwhile, Elecon Engineering has also announced an investment of INR 182 crore for 2008, which will be used to upgrade and enhance capacity at its manufacturing location in Vallabh Vidyanagar in Gujarat. About INR 100 will be specifically invested in expanding capacity for the wind mill gear box facility.

Elecon makes stackers, re claimers, elevators, chain conveyors, ship loader, crawler and rail mounted trippers, gear boxes among other products. It has not made it clear whether the target company will form synergies with its material handling equipment division or the gear box division.