Kansai Nerolac Paints Ltd is set to acquire 100% equity in powder coatings maker Marpol Pvt. Ltd for $5.53 million ( Rs 36 crore) in cash, the company said in a stock-exchange disclosure.
Through the acquisition, Kansai Nerolac expects lower raw material costs and other miscellaneous costs.
“Kansai Nerolac is a leader in the powder-coating market in India,” said H M Bharuka, vice-chairman and managing director of Kansai Nerolac Paints.
He added that Marpol fits in perfectly well with the long-term objective of the company.
The acquisition is expected to be completed by the end of May.
Incorporated in 1983, Goa-based Marpol is promoted by the family of Shanu Atmaram Pai Panandiker.
Marpol registered a revenue of Rs 63.2 crore and profit after tax of Rs 1.57 crore for 12 months to March 2017, according to VCCEdge, the data research platform of VCCircle.
Kansai Nerolac Paints
Kansai Nerolac is a subsidiary of Japan-based Kansai Paint Company Ltd. As on 31 December 2017, Kansai Paint held 74.99% stake in the company that has four plants in India.
Kansai Nerolac has technical-assistance agreement with Canada-based Protech Chemicals Ltd for powder-coating products, according to its annual report.
The company’s net sales stood at Rs 4,584.5 crore and net profit at Rs 510 crore for the 12 months ended March 2017.
Other deals in the sector
Kolkata-based Berger Paints India had acquired Saboo Coatings for Rs 81.7 crore ($12.6 million) to boost its industrial coatings business.
In February 2017, Asian Paints agreed to acquire Sri Lanka’s Causeway Paints Lanka to expand its overseas business.