Somany Ceramics today said it will acquire 26% stake in Gujarat-based Commander Vitrified Pvt Ltd (CVPL) for Rs 3.25 crore.
The company has inked a memorandum of understanding with CVPL and its promoters to acquire equity stake of 26% in CVPL for Rs 3.25 crore, with an option to further increase the stake up to 51%, Somany Ceramics said in a filing to the BSE.
CVPL is at an advanced stage of setting up a new plant to manufacture about 2.65 million square meters of vitrified tiles (polished and glazed) per annum at Morbi (Gujarat).
The plant is expected to commence production by the end of May 2012.
"This strategic stake will give complete access to the company to procure and sell the entire quantity of vitrified tiles to be manufactured by CVPL," the company said.
Shares of Somany Ceramics were trading at Rs 41.15 on the BSE in late afternoon trade, up 1.73% from its previous close.