Sudarshan Chemical Industries has completed the sale of its 100% stake in VP4 Frankfurt GmbH for €76.5 million to a Celanese Corporation subsidiary. According to reports from CNBC TV18 and Business Standard, the transaction was executed through Sudarshan Germany Horizons GmbH, a step-down wholly-owned subsidiary of Sudarshan Chemical Industries. The buyer is part of Celanese Corporation, a global chemical and specialty materials company that does not belong to the promoter or promoter group of Sudarshan Chemical Industries.
As reported by CNBC TV18 and Business Standard, VP4 Frankfurt is primarily engaged in manufacturing certain intermediates, primarily as a tolling operator, with only a small share of its output meant for captive consumption of Sudarshan Germany Horizons. The company noted that VP4 Frankfurt had become part of Sudarshan via its acquisition of the Heubach Group, and the divestment would strengthen the company's strategic focus and operational position. The transaction places VP4 Frankfurt more closely aligned with its principal customer, Nutrinova, though post-transaction Nutrinova will continue to supply Sudarshan with required materials. VP4 Frankfurt serves Nutrinova as its principal customer, with Diketene being an important intermediate for functional food ingredients, making the asset a stronger strategic fit with Celanese and Nutrinova, a producer of additives for the food industry such as sweeteners.
According to the company's exchange filing reported by CNBC TV18 and Business Standard, the stake sale will further sharpen the company's focus on its core pigment business. The divestment strengthens Sudarshan's strategic focus and operational position by aligning VP4 Frankfurt more closely with its principal customer, Nutrinova, which is an affiliate of Celanese Corporation and Mitsui & Co. Japan. Upon completion of sale, VP4 Frankfurt will cease to be a step-down wholly-owned subsidiary of Sudarshan Chemical Industries.
Rajesh Rathi, chairman and managing director of Sudarshan Chemical Industries, described the sale as a strategic step in sharpening focus. As reported by CNBC TV18, he stated that "Pigments and colorants are where we create the most value for our customers. VP4 is a well-run business with a strong team, and it now moves to the company it already serves. That is the right outcome for the asset, for its employees, and for Sudarshan."
According to CNBC TV18, shares of Sudarshan Chemical Industries ended the previous session 1.04% up at ₹1,270 apiece. The stock has gained 18.9% in the past month and is up 34.8% this year, so far. The completion date of the sale is subject to fulfilment of condition precedents and customary closing conditions.
