Chennai: Murugappa Group’s Carborundum Universal Ltd on Tuesday said the Board of CUMI International Ltd (CIL), Cyprus, has approved the initiation of the voluntary winding up of its German subsidiary, CUMI AWUKO Abrasives GmbH (CAAG), citing continued underperformance, mounting losses, and its inability to turn around amid prevailing market conditions.CAAG, engaged in manufacturing coated abrasives for wood and leather applications, was formed after CUMI acquired the assets of AWUKO Abrasives Wandmacher GmbH & Co. KG through insolvency proceedings in February 2022.CAAG reported a revenue of €10.1 million and a loss after tax of €10.2 million in FY25, as against a revenue of €9.1 million and a loss after tax of €2.3 million in FY24.Carborundum said CAAG has faced structural challenges, including limited product-market scope, intense price competition amid global overcapacity, low utilisation, and rising input costs due to geopolitical and macroeconomic pressures. Despite multiple turnaround efforts and investments, the subsidiary has not shown signs of recovery.CIL has therefore decided to proceed with the closure of the entity under applicable German laws.CAAG is not a material subsidiary, and its winding down is not expected to impact the company’s overall business. The estimated financial impact of the closure is pegged at ₹110–130 crore, subject to change based on asset realisation and liabilities, the company said in a stock exchange filing.The company said all due procedures under German liquidation laws will be followed before completion of the winding-up process.
