Mumbai: Berger Paints has acquired the decorative business of US-based Sherwin Williams Paints’ Indian subsidiary for an undisclosed amount.
The acquisition, carried out through Berger’s wholly owned subsidiary Brushworks, was funded through internal accruals. This will help the Kolkata-based paint major to strengthen its position in decorative or the architectural paint business.
Berger’s Managing Director Abhijit Roy said, “The acquisition will increase our presence in South India through their dealer network. Sherwin Williams has a strong foothold in the southern market. It will also help increase our overall capacity and attain a market share of 24 per cent.”
However, Sherwin Williams will continue to compete with Berger on the industrial paint division. It entered into the Indian market three to four years ago with the purchase of the business of Nitco Paints.
When asked, whether Berger was considering a complete takeover of all the businesses of Sherwin Williams (SW), Roy said “It was they (SW) who approached us with the takeover, so if they find any synergy in the industrial business, we might consider it too.”
The company also said that it is investing Rs 240 crore in the expansion of its manufacturing units over three years. Of this, it will invest Rs 180 crore in construction of a greenfield unit at Hindupur in Andhra Pradesh with a capacity of, 6000 tonnes a month. The rest will be used in the expansion of existing units in Rishra in West Bengal and Goa.
Berger, with an annual turnover of Rs 1,000 crore, has a production capacity of 24,000 tonnes a month across seven units. With the new unit at Hindupur and acquisition of Sherwin Williams’ Taloja plant, it is likely to go up to 36,000 tonnes a month.
Meanwhile, the company’s shares hit a new high at Rs 210 in intra-day trading on Monday but closed at Rs 206 .85, up 2.66 per cent on the BSE.
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