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Asian Paints today said it will invest Rs 120 crore in kitchen solutions provider Sleek International, in which it will pick up 51% stake.
"The investment was approved by the board of Asian Paints Ltd on August 8 and the infusion of funds in two tranches of Rs 120 crore shall be completed by August 10, 2013," the company said in filing to BSE.
As part of the deal, Asian Paints will infuse Rs 99.78 crore for 51% stake by subscription to equity shares of Sleek International Pvt Ltd (SIPL), which has been completed today.
The company would further infuse Rs 19.69 crore on August 10, as the second tranche of this transaction by further subscription to equity shares of SIPL with a corresponding proportionate infusion by the existing promoters of SIPL.
The Ahuja family, promoters of Sleek International holds the balance 49% stake and its current CEO Rajesh T Ahuja will continue in company.
"On completion of the infusion in the second tranche, the company would continue to hold 51% stake in SIPL," Asian Paints said.
"The engagement with the Sleek management over the last few months has reaffirmed our faith in the business and the opportunity of growth and synergy that it offers us. This is also the first step in our strategic foray in the Home Improvement space," Asian Paints Managing Director & CEO K B S Anand said.
It will nominate 2 non executive directors on Sleek's board.
In March, Asian Paints had announced that it would acquire SIPL and the deal would be funded through internal accruals by the company.
Asian Paints with a consolidated turnover of Rs 10,970 crore is ranked among the top ten decorative coatings companies in the world and have operations in 17 countries.
It has 25 paint manufacturing facilities, servicing consumers in 65 countries through Berger International, SCIB Paints Egypt, Asian Paints, Apco Coatings and Taubmans.
