Kiri Industries Limited has informed the Exchange about Acquisition
KIRIINDUS · price
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Kiri Industries is investing Rs. 70 crore to acquire a 99.93% equity stake in IndoAsia Agrotech Fertilizers Limited (IAFL) by subscribing to 7 crore equity shares of Rs. 10 each at par. Upon allotment, IAFL will become a subsidiary of Kiri Industries. IAFL is a newly incorporated unlisted company (July 2024) that is setting up a fertilizer manufacturing facility in Gujarat and has not yet started commercial operations. The transaction is a related party deal, as Kiri Industries' CMD Manish Kiri and his wife are directors of IAFL, though it will be done at arm's length. The investment is expected to complete within one month and is funded entirely through cash.
This is a diversification move into fertilizer manufacturing, but the target is a pre-revenue company with no operating history, carrying execution risk. Shareholders should note the related-party nature of the deal and monitor how the Rs. 70 crore deployment translates into actual manufacturing capacity and returns.