RIL buys polyester business of Shubhalakshmi PolyestersRELIANCE - 2401 Change: 6.30 (0.26 %)
News: A subsidiary of Reliance Industries has executed definitive agreements to buy the polyester business of Shubhalakshmi Polyesters (SPL) and Shubhlaxmi Polytex (SPTex) for Rs 1,522 crore and Rs 70 crore, respectively, in a slump sale on a going concern basis.
View: SPL has a continuous polymerisation capacity of 2,52,000 MT/Annum and manufactures polyester fibre, yarns and textile grade chips through direct polymerisation route as well as extruder spinning with value addition through texturising. The manufacturing facilities are located at Dahej (Gujarat) and Silvassa (Dadra & Nagar Haveli). Further SPTex has a texturised yarn manufacturing facility at Dahej. The cumulative transaction values the companies at 0.8x market capitalisation to sales ratio. The manmade textile industry has been on the focus list of the Government of India with the launch of initiatives like the production linked incentive scheme (PLI) for enhancing India’s share in global exports. The acquisitions by RIL are part of the company’s strategy to expand its downstream polyester business, which would enable it to cater to the growing demand of polyester and polyester based products.