Mawana Sugars Ltd has entered into a definitive agreement to sell its non-core business to Bodal Chemicals Ltd, another publicly listed company.
Mawana Sugars said it is selling the Punjab-based Siel Chemical Complex in a slump sale for Rs 137 crore (nearly $18.8 million).
The chlor-alkali unit in question has a caustic capacity of 82,500 million tonnes per annum. It recorded a revenue of around Rs 240 crore during the 2019-20 financial year, Mawana Sugars said in a statement.
For Bodal Chemicals, the acquisition will help expand its speciality chemicals portfolio and become a vertically integrated player in the chlorine downstream products market.
Global investment banking firm Singhi Advisors acted as the exclusive adviser for the transaction.
Shares of Mawana Sugars ended trading on Tuesday, 4.96% down at Rs 32 apiece. The New Delhi-based company is part of the diversified Siddharth Shriram Group, which has interests in sectors including consumer durables, sugar, power, and real estate.
It recorded consolidated net sales of Rs 1,396 crore and net losses of Rs 83 crore for the 2019-20 fiscal.
Bodal Chemicals also saw its share price dip at the end of the day’s market session, with its stock falling 0.66% to Rs 74.7 apiece. The company recorded consolidated net sales and profits of Rs 1,374.8 crore and Rs 86.6 crore, respectively, for the 2019-20 financial year.
Ahmedabad-based Bodal Chemicals is involved in the manufacture and export of dye intermediates, dyestuffs, and sulphuric acid and sulphur bulk chemicals. It operates nine manufacturing units in Gujarat, one in Uttar Pradesh, and has seven depots across the country.