Rossari Biotech to acquire Unitop Chemicals for Rs 421 crore

The speciality chemicals manufacturer, Rossari Biotech Limited has announced that it will acquire 100 per cent of the equity capital of Unitop Chemicals for Rs 421 crore.

In a regulatory filing, Rossari Biotech said, "Its Board of Directors has approved the acquisition of Unitop Chemicals Private Ltd."

As per the plan, 65 per cent of the equity share capital of Unitop Chemicals will be acquired upon closure of the transaction, and the balance 35 per cent over the next two years.

The total consideration for the acquisition of a 100 per cent equity stake is Rs 421 crore. Rossari plans to fund the investment through cash on the balance sheet and doesn't intend to raise any debt for this acquisition. In April 2021, Rossari concluded a preferential issue of equity aggregating to Rs 300 crore to augment the strength of its balance sheet.

The company in a statement said, this 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. It has a strong product portfolio with a superior presence in the Agrochemicals and Oil & Gas segment. The company's key expertise is centred on surfactants, which is one of Rossari's four core chemistries. Unitop Chemicals has three manufacturing sites in India with a total capacity of ~86,000 MTPA and its key facility in Dahej is in close proximity to Rossari's existing facility.

In the fiscal year 2020, Unitop Chemicals' revenues stood at Rs. 280 crore, with adjusted EBITDA at Rs. 43 crore. FY2021 unaudited estimated revenues stood at over Rs 300 crore. The company has a healthy balance sheet profile with zero net debt. Unitop Chemicals' solutions are sold across 25+ countries, with exports accounting for 30 per cent of revenues in FY2020.