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SRF Limited announces definitive agreement to sell its Engineering Plastics Business to DSM

ANI | Updated: May 12, 2019 11:21 IST

Gurugram (Haryana) [India] May 12 (ANI/NewsVoir): SRF Limited, a chemical based multi-business entity engaged in the manufacturing of industrial and speciality intermediates announced that it has entered into a definitive agreement to sell its Engineering Plastics Business to DSM, the Life Sciences and Materials Sciences company in an all-cash transaction, amounting to Rs 320 crore.
The company's Engineering Plastics Business manufactures multiple grades of engineering plastic compounds, catering to the automotive and electrical industries.
"Today marks a significant milestone for our company, as we take another step along our strategic direction of focusing on our core Businesses," said Ashish Bharat Ram, Managing Director, SRF Limited.
"While the Engineering Plastics Business has been a profitable and niche business for us, we felt that scaling it into a large business would have taken significant time and in that sense passing it onto a credible player would be logical for everyone involved", he added.
Broadly, the transaction announced would enable SRF to achieve three critical goals for the company and its shareholders. First, the transaction will provide cash and liquidity to strengthen the Company's balance sheet further.
Second, the transaction will allow optimising and focusing efforts and resources on developing more-and-more complex technologies within the Chemicals Business space, which has the potential to be competitively dominant and put the company in a strategically good position.
Third, the transaction will recognize the value of Engineering Plastics Business. It will place many of the outstanding employees into DSM, a highly capable and global leader in the engineering plastics space.
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