- Shares of Kansai Nerolac Paints were up 1% intraday following the acquisition of the company.
- The move comes under Nerolac’s ongoing efforts to grow the company’s portfolio to better serve its customers.
Kansai Nerolac Paints Limited (Nerolac), India’s largest industrial paint & third-largest decorative paint company, reportedly witnessed a 1% rise in its shares following its acquisition of Perma Construction Aids Pvt Ltd (Perma), a Mumbai-based construction chemical company.
Reports cite, the company had earlier announced that it has signed a Share Purchase Agreement (SPA) to procure 100% equity stake of the construction chemical company for a total amount of INR 29.10 crores.
According to a public notice released by the company, the aggregate consideration amount of about INR 29.10 crores would be used to acquire approximately 990,000 equity shares of Perma at a face value of about INR 10 per share. The acquisition is scheduled to reach completion by January 28, 2019 and would be subject to satisfaction of Conditions Precedent mentioned in the SPA.
The Vice Chairman & Managing Director of Kansai Nerolac Paints, H M Bharuka stated that the company with this acquisition is further expanding its product portfolio in an effort to enable the company to facilitate a complete solution to its customers. Bharuka further added that the construction chemical portfolio of Perma Construction is complementary to the company’s product offerings & has synergies with its extensive paint distribution network.
Nerolac shares reportedly shot up by about 1.33% following the announcement of the acquisition with company shares trading at a high of about INR 486.25 per share on the Bombay Stock Exchange (BSE).
For the record, incorporated back in 1997, Perma Construction has been an active player in the business of construction chemicals with a product range spanning from epoxy & water-proofing to adhesives & admixtures.
According to reports, the acquisition would reportedly be subject to adjustments for borrowings, fixed assets as well as working capital as at the deal’s closing date.