Astral Limited has entered into definitive agreements to acquire 51% stake in Operating paint business of Gem Paints from Gem Paints Limited for INR 1.9 billion.

Astral Limited (BSE:532830) has entered into definitive agreements to acquire 51% stake in Operating paint business of Gem Paints from Gem Paints Limited for INR 1.9 billion on April 1, 2022. INR 1940 million for 51% equity stake of Operating Paint Business of Gem Paints to be acquired post demerger of Operating Paint Business of Gem Paints Private Limited. The Operating Paint Business of Gem Paints Private Limited is proposed to be demerged to a wholly owned subsidiary of Gem Paints Private Limited viz.

Esha Paints Private Limited. Upon the completion of demerger, Astral will acquire 51% equity shares of Esha Paints Private Limited against the redemption of OCDs. The balance 49% equity stake will be acquired by Astral over a period of 5 years in tranches as per the Share Purchase Agreement entered between the parties.

Upon completion of demerger of Operating Paint Business of Gem Paints, Astral shall acquire 51% equity stake of Resulting Company (Esha Paints Private Limited). Astral Board of Directors in their meeting held today approved to acquire 51% controlling equity stake in Operating Paint Business of Gem Paints Private Limited. The acquisition of 51% equity stake in the Operating Paint Business of Gem Paints Private Limited is expected upon completed upon completion of demerger March 31, 2023 (tentative).

Rajeev Vidhani and Anand Mehta of Khaitan & Co. provided due diligence to Astral Limited.