Primo Chemicals plans to acquire the remaining 51% of Flow Tech Chemicals, increasing its stake to 100%. This move aims to enhance strategic control and operational synergies, particularly for its chlor-alkali assets. Shareholders are also voting on new independent directors.
Primo Chemicals to Acquire Full Control of Flow Tech Chemicals
Primo Chemicals Ltd has announced its intention to acquire the remaining 51% equity stake in Flow Tech Chemicals Private Limited, an associate company where it currently holds 49%. The acquisition is set to be completed by March 31, 2027, at a price of ₹1,418.20 per share. This move is expected to significantly enhance Primo Chemicals' strategic control and operational synergies, particularly concerning its chlor-alkali assets.
What just happened
Primo Chemicals will acquire the remaining 51% stake in Flow Tech Chemicals for ₹1,418.20 per share. The company currently holds a 49% stake, making Flow Tech an associate.
Why this matters
This acquisition aims to improve Primo Chemicals' strategic control and operational synergies. It will allow for better chlorine evacuation and optimize the utilization of its chlor-alkali assets. Flow Tech is already a customer for Primo's chlorine.
The backstory
Flow Tech Chemicals has shown consistent growth, with its turnover increasing from ₹227.96 crore in FY 2023-24 to ₹341.66 crore in FY 2025-26. Its Profit After Tax (PAT) has also risen from ₹1.02 crore to ₹9.80 crore over the same period.
What changes now
Upon completion, Primo Chemicals will have 100% ownership of Flow Tech. This will enable complete integration of operations and potentially unlock further efficiencies. The acquisition price is below the fair value of ₹1,545.40 per share determined by BDO Valuation Advisory LLP.
Risks to watch
Integration challenges and the realization of expected operational synergies are key factors to monitor. The e-voting period for shareholder approval for this acquisition, director appointments, and remuneration runs from July 7 to August 5, 2026.
Peer comparison
While specific peer data isn't provided in the filing, the acquisition is positioned to strengthen Primo Chemicals' competitive standing by consolidating a key downstream consumer of its primary products.
Context metrics (time-bound)
Flow Tech Chemicals' turnover grew from ₹227.96 Cr (FY 2023-24) to ₹341.66 Cr (FY 2025-26), and PAT grew from ₹1.02 Cr to ₹9.80 Cr in the same period. Acquisition completion target is March 31, 2027.
What to track next
Investors should watch for the successful completion of the acquisition by the March 2027 deadline and the tangible benefits derived from improved operational synergies, especially concerning chlorine utilization.