Berger Paints to acquire Kolkata-based construction materials maker
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Paint manufacturer Berger Paints India Ltd has agreed to acquire a Kolkata-based maker of construction and related materials for an enterprise value of Rs 167.5 crore (about $23.5 million at current exchange rates).

Berger Paints said in a filing with stock exchanges that it will acquire a 95.53% stake in of STP Ltd. The remaining 4.47% stake will be held by STPL’s existing shareholders.

STPL is an unlisted company that makes and supplies a wide range of construction chemicals, concrete admixtures, waterproofing chemicals, flooring compounds, bitumen and coal tar-based products.

Berger Paints said the acquisition will supplement its businesses relating to manufacturing, selling, and product distribution and procurement. It expects the deal to be completed by the end of November.

STPL was incorporated in 1935. It has six factories, four regional offices and a pan-India network of dealers. The company reported revenue of Rs 174.02 crore for the year through March 2019.

Kolkata-based Berger Paints, which has a market capitalisation of Rs 43,633.65 crore, is among India’s top paint companies. It makes industrial paints and consumer products like metal and wood paints, interior wall coatings, exterior wall coatings and clear coats for wood, according to its website.

In June 2017, it acquired specialty coatings maker Saboo Coatings Pvt. Ltd for Rs 81.77 crore to boost its industrial coatings business. In May that year, Berger’s board had also approved the acquisition of a 51% stake in Saboo-Hesse Wood Coatings Pvt. Ltd, which sells acrylic wooden coating.

Other paint companies have also been making acquisitions to boost their businesses and product portfolio. In December 2017, Asian Paints acquired a 49% stake it didn’t already own in Sleek International Pvt. Ltd, a maker of modular kitchens and wardrobes, for Rs 50 crore ($7.8 million). Asian Paints had purchased a 51% stake in Sleek International from the Ahuja family in 2013, marking its entry in the home-improvement segment.

Also in 2017, Asian Paints purchased Sri Lanka’s Causeway Paints Lanka Pvt. Ltd to expand its overseas business and paid Rs 159.5 crore to acquire Reno Chemicals Pharmaceuticals and Cosmetics Pvt. Ltd.

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