Kansai Nerolac Paints Ltd has agreed to acquire a 100% stake in construction chemicals company Perma Construction Aids Pvt. Ltd for Rs 29.1 crore (about $4.16 million) in cash.
The value of the acquisition is subject to adjustments for borrowings, working capital and fixed assets at the closing date, according to a stock-exchange disclosure by Kansai Nerolac.
Kansai Nerolac said the acquisition will increase its product offerings in the construction chemicals business.
The transaction is expected to close by 28 January next year.
“Construction chemical is complementary to paints and has synergies with paints distribution networks. Kansai Nerolac will be strengthening its existing product portfolio with this acquisition,” said H M Bharuka, vice-chairman and managing director of Kansai Nerolac.
Incorporated in 1997, Gujarat-based Perma Construction Aids’ product range encompasses water-proofing, adhesives, epoxy and admixtures.
It exports products to Sri Lanka, Nepal, Mauritius and Ghana.
Its turnover stood at Rs 27.3 crore for the year through March 2018, up from Rs 25.39 crore the previous year.
Kansai Nerolac is a subsidiary of Japan-based Kansai Paint Company Ltd. As on 30 September, Kansai Paint held 74.99% stake in the company.
The products offered by the company include automotive coatings, powder coatings, and decorative coatings. It has four manufacturing plants in the country.
The company’s consolidated revenue from operations stood at Rs 4,808.5 crore for the year through March 2018, up from Rs 4,584.5 crore the previous year.
Earlier this year in April, Kansai Nerolac had acquired powder coatings maker Marpol for Rs 36 crore ($5.53 million).
In June, it agreed to acquire a 55% stake in Bangladesh-headquartered RAK Paints Ltd for Rs 45.81 crore (around $7 million).