Rossari Biotech jumped 4.99% to Rs 1,326.90 after the company announced that its board of directors has approved the acquisition of Unitop Chemicals for a consideration of Rs 421 crore.
As per the agreement and subject to customary closing conditions, Rossari will be acquiring 100% of the equity capital of Unitop Chemicals. The speciality chemicals manufacturer will acquire 65% of the equity share capital upon closure of the transaction, and the balance 35% over the next two years.
The total consideration for the acquisition of 100% equity stake is Rs 421 crore. Rossari plans to fund the investment through cash on balance sheet and doesn't intend to raise any debt for this acquisition.
The acquisition brings further dynamics to Rossari's growth story. It brings synergies and complementary dimensions such as expanded product portfolio, presence in adjoining areas of speciality chemical segments, pooling together of related technologies, larger international exposure, better domestic market reach, well-experienced and competent talent pool and increased end-user industry applications. The combination of Unitop Chemicals with Rossari will augment the quality and acceleration of the company's growth going forward.
Unitop Chemicals is a leading supplier of Surfactants, Emulsifiers and Specialty chemicals to a diversified customer base including large domestic and international companies. In the fiscal year 2020, Unitop Chemicals' revenues stood at Rs 280 crore, with adjusted EBITDA at Rs 43 crore.
Commenting on the business update, in a joint statement, Edward Menezes, promoter & executive Chairman, and Sunil Chari, promoter & managing director said, Unitop Chemicals is a natural fit with our operations and brings with it immense synergies and complementary growth dimensions.
Rossari Biotech is a speciality-chemicals manufacturer providing intelligent and sustainable solutions for customers across industries.
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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)
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