Jay Shree Tea & Industries Ltd, a B K Birla group company engaged in the manufacturing of tea, is planning to acquire M P Chini Industries Ltd, a sugar manufacturing firm in Bihar. Jay Shree will pay around Rs 112.5 crore for buying all the shares of M P Chini, the company said in its filing to the Bombay Stock Exchange.
M P Chini has a crushing capacity of 4,600 tonne per day. Besides, M P Chini also has a power plant attached to it for captive use with a power generation capacity of 6MW, the statement added.
Jay Shree Tea plans to fund the acquisition through internal accruals and debt. It has convened a board meeting on March 30 to decide and get shareholders approval on the same. Jay Shree is expecting to close the deal in the next six weeks.
In January this year, it entered into a consortium agreement with a Rwandan company and has put in a bid to acquire tea estates owned by OCIR-THE, the government of Rwanda. In domestic markets as well, the company has been looking for possible tie ups and acquisition and had entered into an agreement with Assam Tea Corp Ltd for purchase of green leaf and operate its factory in Longai, Assam.
At 2.40 p.m., the shares of Jay Shree Tea were traded at Rs 328, down by Rs 4.9 or 1.47% in the BSE. In fiscal 2008-09, the net sales and net profit of the company were Rs 419.2 crore and Rs 12.76 crore, respectively.