Piramal Enterprises sinks 5% despite acquisition plans of its Pharma arm

Piramal Pharma and Navin Fluorine Mutually Agree on Piramal increasing its stake to 100% in Convergence Chemicals at Rs65.10cr.

Oct 29, 2020 12:10 IST India Infoline News Service

Piramal Pharma Limited (PPL), a subsidiary of Piramal Enterprises Limited (PEL), and Navin Fluorine International Limited (Navin Fluorine) on Wednesday announced a mutual agreement to increase Piramal’s stake in Convergence Chemicals Private Limited (CCPL) to 100% by buying out Navin Fluorine’s 49% stake in CCPL at Rs65.10cr. Recently, PEL transferred its entire stake in CCPL to PPL.

At around 12.39 pm, Piramal Enterprises Ltd is trading at Rs1,219.10  per piece down by Rs62.95 or 4.91% from its previous closing of Rs1,282.05 per piece on the BSE. The scrip opened at Rs1,250.05 and has touched a high and low of Rs1,280 and Rs1,219.10 respectively.

CCPL, incorporated in November 2014, develops and manufactures specialty fluorochemicals, primarily starting material required for PPL’s anesthetics production.

As PPL continues to grow its anesthetics business, its resultant requirement for the starting material is expected to increase in the coming years. Similarly, it is expected that Navin Fluorine will leverage the developed chemistry for growth in certain specialty chemical segments.

As a part of this arrangement, Navin Fluorine would obtain from PPL a perpetual license to use the technical knowhow for development and marketing of select products, and Navin Fluorine would continue to be a key raw material supplier to CCPL.

The Agreements are subject to customary regulatory closing conditions.

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