Rossari Biotech Ltd, a speciality chemicals manufacturer, on Wednesday announced that its board of directors has approved the acquisition of Tristar Intermediates Pvt. Ltd.
Rossari will be acquiring 100% equity of Tristar Intermediates. Of this, 76% equity will be acquired on closing the transaction, and the balance 24% over the next 3 years, the speciality chemicals company said.
The total enterprise value of the transaction is ₹120 crore. Rossari plans to fund the investment through cash on balance sheet and doesn’t intend to raise any debt for this acquisition.
The transaction brings together two companies within the speciality chemical space. “The blend of capabilities will add scale, provide cross-selling opportunities, and accelerate growth for Rossari, while significantly enhancing value creation in the longer term. The synergistic acquisition provides Rossari with enhanced portfolio of products, stronger presence in new and untapped international markets and access to newer technologies,” Rossari said in a statement.
Tristar Intermediate’s promoters will continue to drive the business for at least the next three years. Incorporated in 1998, the company Tristar Intermediates’ business spans preservatives, aroma chemicals, and home and personal care additives with high-tech distillation facilities. It is a preferred supplier to companies across India, Europe, the US and far eastern countries. The Pune-based firm’s product range also has applications across pharmaceuticals, textiles, paints, automotive, and agro-chemicals. The company has manufacturing facilities at Sarigam (Vapi), Gujarat, India with a total capacity of 15,000 million tonne per annum (MTPA).
In fiscal year 2021, Tristar Intermediate’s revenue stood at ₹110.5 crore, with Ebitda of ₹15.6 crore, and 14.1% Ebitda margin. PAT was at ₹10.4 crore. Ebitda stands for earnings before interest, tax, depreciation, and amortization.
Edward Menezes, Rossari promoter and executive chairman, and Sunil Chari, Rossarti promoter and managing director, said in a joint statement that the acquisition of Tristar Intermediates is a strategic and important milestone for the company. “The combined capabilities will provide a strong growth momentum and will enable us to expand further into the high-potential product categories of personal care and home care, among others. The addition of new international markets, cross-selling opportunities, talent, and technology know-how will also drive business efficiencies,” Commenting on the business update, in a joint statement,” they added.
This article was first published on livemint.com.