Outcome and Intimation of Board Meeting under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 - Acquisition
Price
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Aten Papers & Foam's board has approved acquiring a 27.40% stake in Aten Paper Mill Limited by purchasing 2,74,000 equity shares at Rs. 430 per share, for a total cash consideration of approximately Rs. 11.78 crores. The target, Aten Paper Mill Limited, is a leading kraft paper manufacturer in Gujarat with FY24-25 turnover of around Rs. 177.65 crores and net profit of about Rs. 10.67 crores. The acquisition is a related party transaction since the company's Managing Director and Promoter, Mr. Mohamedarif Lakhani, has an interest in the target entity, though it is being done at arm's length. The deal is aimed at expanding the company's product offerings, accessing new markets, and achieving cost synergies in the kraft paper segment.
The acquisition could strengthen Aten Papers & Foam's presence in the kraft paper industry and add meaningful revenue to its books, given the target's ~Rs. 178 crore turnover. However, investors should note the related party nature of the deal, which may raise governance and conflict-of-interest concerns, and watch for shareholder approval and the completion timeline.