Pidilite Industries, the manufacturers of the popular Fevicol brand of adhesives, on Thursday announced that it has agreed to acquire complete interest in US-based Huntsman Group’s Indian subsidiary Huntsman Advanced Materials Solutions Private Limited (HAMSPL) for Rs 2,100 crore.

The board of Pidilite Industries approved a definitive agreement with Huntsman Group for acquiring 100 per cent stake in one of their subsidiaries in India at its meeting on October 28.

“We’ve entered into a definitive agreement to buy the consumer and bazaar business of the US-based Huntsman Group’s India arm , Huntsman Advanced Materials Solutions for Rs 2,100 crore.

“The cash consideration excludes customary working capital and other adjustments, subject to certain preconditions being met prior to the closing of the transaction. The agreement was signed last night,” Pidilite Industries said a statement.

The acquisition pitch by Pidilite includes HAMSPL’s Indian subcontinent business, apart from a trademark licence for the Middle East, Africa and ASEAN countries, the statement added.

It can be noted that Fevicol is synonymous with adhesives to the millions here. Its other major brands include MSeal, Fevikwik, Fevistik, Roff, Dr.Fixit, Fevicryl, Motomax and Hobby Ideas.

Huntsman operates a 100 per cent subsidiary in the country, Huntsman Advanced Materials Solutions, which directly competes with Fevicol, as it manufactures and sells adhesives, sealants and other products under brands such as Araldite, Araldite Karpenter and Araseal in the country. It had a revenue of around Rs 400 crore in 2019, from its operations here. The Huntsman Group is a leading global producer of differentiated organic chemical products.

Under the deal, Huntsman will receive around 90 per cent of the cash consideration at closing and balance around 10 per cent within 18 months if the business achieves sales revenue in-line with 2019. The transaction is expected to close by next week.

“With this acquisition, Araldite will add to the already very strong portfolio of our adhesives and sealants and will complement our retail portfolio. We are confident that this acquisition will create significant shareholder value through strong revenue and cost synergies, Bharat Puri, thed managing director of Pidilite said.

Apurva Parekh, an executive director at Pidilite said, Araldite is an iconic brand and a market leader in epoxy adhesives in the country.

Pidilite is the market leader in adhesives and sealants, construction chemicals, craftsmen products, DIY (do-it-yourself) products and polymer emulsions in the country. It also sells paint chemicals, automotive chemicals, art materials, and stationery, maintenance chemicals, industrial adhesives, industrial, textile resins and organic pigments and preparations.

Shares of Pidilite Industries were trading at Rs 1,558, up 2.61 per cent on the BSE.