Kiri Dyes take over SSP plant of Bodal Chemicals

Ahmedabad-based Kiri Dyes has taken over the single super phosphate (SSP) plant of Bodal Chemicals for Rs640 crore in a cash transaction.

Bodal Chemicals' share price had risen today as also its market capitalisation at Rs230 crore. Its share price reached a 52-week high of Rs41 per share on the BSE.

The Padra (Vadodra) located SSP plant was established in 2008, at a cost of Rs31 crore, for the manufacture of sulphuric acid, dyes and dyes intermediaries.

The capacity of the units stood at 7 lakh MTPA and additionally, Bodal also operated manufacturing concerns at Ankleshwar, GIDC Ahmedabad, Vapi and Vadodara. The company projects Rs750 crore in turnover for FY12, with profit of Rs 26 crore.

According to Suresh J Patel, chairman and managing director of Bodal, the liquidity generated through the transaction would be used for debt repayment and diversification.

He added Bodal would become a zero-debt company after repayment of the existing debt.  Bodal was now looking for expansion across new businesses and might consider inorganic route for the same.

Kiri Dyes has been a fairly acquisitive player, as it bought the North American (2010) and German unit (2009) of DyStar for $10 million and $68.5 million, respectively.

The business transfer agreement was executed by both the parties and the transaction would be effected by way of slump sale which was expected to be completed by September, 2011.