The board of directors of Kansai Nerolac Paints (KNPL) have approved acquisition of shares (40% of the total shareholding) of Nerofix from Polygel Industries (Polygel) for Rs 37 crore. Consequent to the said acquisition of shares, Nerofix will become a wholly-owned (100%) subsidiary of the company, it said in a BSE filing.
80,00,000 equity shares of Rs 10 each i.e. 40% of the total shareholding of Nerofix is being acquired. Post acquisition the company will hold 2,00,00,000 equity shares of Rs 10 each. The acquisition is expected to be completed by March 31, 2023.
In May 7, 2019, the company entered into a joint venture agreement with Polygel with a paid up share capital of Rs 20 crore, out of which KNPL contributed Rs 12 crore and Polygel shall contribute Rs 8 crore, it had informed in the regulatory filing.
Under this joint agreement, the joint venture will be established by incorporating a separate company, to which the adhesives, construction chemicals and sealants business of Polygel would be transferred under a separate business transfer agreement (BTA).
In August 2019, the BTA was entered between Nerofix (incorporated in terms of JVA, paid-up equity capital of which was held by KNPL and Polygel in the ratio of 60:40), Polygel, promoters of Polygel and KNPL.
Nerofix manufactures construction chemicals and adhesives and distributes them through its network of distributors in India and South Asia. It had a net revenue of Rs 110.41 crore for the financial year ended March 31, 2022.