Pidilite acquires Consumer & Bazaar business of Araldite in Indian Sub-Continent
The Board of Pidilite Industries Limited at its meeting held on 28th October, 2020 approved a definitive agreement with Huntsman Group (USA) for acquiring 100% stake in one of their subsidiaries in India namely, Huntsman Advanced Materials Solutions Private Limited (HAMSPL).
This is for a cash consideration of approx. Rs 2100 crores, excluding customary working capital and other adjustments, subject to certain preconditions being met prior to the closing of the transaction. HAMSPL manufactures and sells Adhesives, Sealants and other products under well-known brands such as Araldite, Araldite Karpenter and Araseal in India. In the calendar year 2019, business revenue was approximately INR 400 Cr. In addition to the Indian Sub-Continent business, the acquisition includes a Trademark licence for Middle East, Africa and ASEAN countries.
Huntsman Group is a leading global producer of differentiated organic chemical products. Under the terms of the agreement, Huntsman will receive approximately 90% of the cash consideration at closing and balance approximately 10% under an earnout within 18 months if the business achieves sales revenue in-line with 2019. The transaction is expected to close by next week.
HAMSPL has a nation-wide distribution network and a strong presence in Retail Trade.
Commenting on the acquisition, Mr. Apurva Parekh, Executive Director, Pidilite Industries Limited, said: “Araldite is an iconic brand and a market leader in Epoxy Adhesives in India. We are thankful for all the support extended by the Huntsman group and we are confident that our association will remain strong going forward as well.”
Mr. Bharat Puri, Managing Director, Pidilite Industries Limited, further commented: “With this acquisition, Araldite will add to the already very strong portfolio of Pidilite’s adhesive and sealant brands and will complement our retail portfolio. We are confident that this acquisition will create significant shareholder value through strong revenue and cost synergies. We look forward to warmly welcoming the HAMSPL team and the trade and business partners to the Pidilite family.”