Berger Paints India Ltd, second largest paint manufacturer in the decorative segment, has signed an agreement for the acquisition of all the shares of Bolix SA, a leading provider of external insulation finishing systems (EIFS), from Advent International, a global private equity group.
The acquisition will be made through a wholly owned subsidiary of Berger Paints India Ltd in Cyprus.
Berger said in a statement that the acquisition will be carried out at an estimated net purchase price of around $38.6 million. The purchase is conditional upon fulfilment of certain conditions precedent including clearance by the Polish anti-monopoly office. The price is subject to usual adjustments at the time of completion of the transaction.
The advisors to the transaction are Ernst & Young, India, and Tomczak & Partners, Poland, for Berger, and Clifford Chance and CAG for Advent International.
Berger said, Bolix is the largest provider of EIFS systems in the Business to Business (B2B) segment in Poland and also exports to neighbouring countries such as Ukraine, Russia and the Baltic States. The annual turnover of Bolix exceeded 100 million Zlotys ($45.5 million) in 2007.
EIFS is a comprehensive solution for meeting both the insulation and decorative requirements of external walls of buildings. Bolix? products, manufactured in-house, include adhesives, mortars, plasters, primers and paints. In combination with other insulation materials like polystyrene foam or mineral wool and auxiliary materials such as fibre glass meshes, Bolix? EIFS products provide significant insulation solutions while at the same time offering a decorative finish suitable for traditional brick or concrete structures.
Berger said the proposed acquisition would provide synergy benefits to its presence in the region?both in terms of new business opportunities and regional markets. Berger registered a net profit of Rs 23.25 crore in the quarter to December 31, 2007, up from Rs 22.5 crore for the same period in 2006-07.