Camlin Fine Sciences to raise up to Rs 180 crore; jumps 10 per cent

Camlin Fine Sciences (CFS) Ltd in its board meeting approved the raising of funds of up to Rs 180 crore (USD23.8 million) from Infinity Holdings and its affiliated entities.

Convergent Finance LLP will act as an investment advisor. Structured as a subscription to equity warrants priced, based on the prevailing market price and in accordance with applicable SEBI regulations, the investment will result in an approximately 22.65 per cent ownership stake on a fully-diluted basis.

The purpose of fund raising would be to consolidate and acquire the entire stake of its joint venture partners in the company’s subsidiaries in Mexico and China, i.e. Dresen Quimica S A P I de C V and CFS Wanglong Flavours Ningbo Co Ltd, as well as to enhance the company’s portfolio in health and wellness segment by launching new products.

CFS Group owns 51 per cent stake in its China subsidiary of CFS Wanglong Flavours Ningbo Co Ltd, with the balance of 49 per cent stake owned by a local partner. In CFS Wanglong, CFS manufactures vanillin, which is a key raw material for flavours, fragrances, pharmaceuticals etc. With the growing global trade tensions in China, the company would like to de‐risk itself by having the ability and flexibility to bring the technology and machinery to manufacture the same products out of India, where the company also has plans to setup a facility to manufacture Ethyl Vanillin.

CFS owns 65 per cent stake in the subsidiary Dresen Quimica S A P I de C V (Mexico), with the balance of 35 per cent stake, owned by a local partner. The company’s Mexico subsidiary has been one of the best performing subsidiaries for CFS and with the growing business outlook, CFS sees an opportunity to consolidate and strengthen its position in this subsidiary.

The stock stock opened at 53.35, up by 10 per cent or Rs 4.85 per share from its previous day's close.