Borosil Limited has signed a binding share purchase agreement (SPA) through its subsidiary to acquire an initial 90.17 per cent stake in Goel Scientific Glass Works Limited (GSGWL), among the oldest scientific glassware companies in the country.
The transaction executed through Klass Pack Limited (KPL), a Borosil subsidiary, comes with a provision to increase stake up to 100 per cent in WL, a Borosil note said. An upfront payment of ₹23 crore would be paid, it added. On completion, GSGWL will become a subsidiary of KPL and a step-down subsidiary of Borosil.
KPL is in the business of primary pharmaceutical packaging and manufactures tubular glass vials and ampoules for the pharmaceutical industry. Upon approval of the NCLT, Mumbai Bench, to the ongoing Composite Scheme of Arrangement between Borosil, KPL and Borosil Technologies Limited (wholly owned subsidiary of Borosil), the Scientific and Industrial Products (SIP) business - lab glassware, lab instrumentation and pharma packaging business of these three entities will stand consolidated in KPL, the company said.
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KPL is proposed to be renamed as Borosil Scientific Limited and will get listed on BSE and NSE, it added. With this acquisition, Borosil’s SIP business will add a complementary product portfolio to its range and will allow it to use its brand, sales and distribution channel for import substitution in this segment.
GSGWL has two plants located in Vadodara, Gujarat and is an established manufacturer of industrial glass process systems as well as laboratory glassware, the note said.
“GSGWL are experts in design, fabrication and installation of Industrial Glass Process Systems for Production and Pilot Plants, maintaining globally accepted quality standards. Its product portfolio comprises industrial glassware, laboratory glassware, customised glassware products and components and finds wide use in the research and development and production departments of the pharmaceutical, defence, agricultural, research and chemical industries,” it said.
Borosil has recently been investing in its SIP business to expand its portfolio with related diversifications in pharmaceutical primary packaging, analytical vials and laboratory bench top equipment. The proposed expansion is in the sphere of glass industrial process systems.
Exponential growth
In India, the chemicals market is growing at approximately 12 per cent and the Active pharmaceutical ingredients (API) market at 13 per cent - almost triple and double the world growth rates respectively. India’s R&D spend is likely to rise sharply over the next few years. The world market size in industrial and laboratory glass process systems is estimated at over $150 million, the note said.
Borosil Managing Director and Chief Executive Shreevar Kheruka said, “With the product portfolio and glass-blowing skills of GSGWL at hand, Borosil’s SIP business will enter into the fast-growing process systems market and will give options to our customers to use world-class products that are made in India at a much more attractive value compared to the currently imported product availability.”
GSGWL Chairman Hemant Goel said he felt “rewarded” for 50 years of hardship and struggle. “I recall sharing with Mr. Kheruka my dream and inherent wish to see India as a world leader and a feeling that he reciprocated by sharing his dream to see Borosil as a world leader. So, we are at a point where our dreams converge and I am now confident of moving towards this direction of achieving and fulfilling them together very soon.”