The Board of Directors of Kothari Petrochemicals Limited has approved a Scheme of Amalgamation with Kothari Sugars and Chemicals Limited as part of efforts to streamline the group's business structure and improve operational efficiency.
The proposed merger is subject to approvals from the National Stock Exchange, the Securities and Exchange Board of India (SEBI), shareholders, creditors and the National Company Law Tribunal (NCLT). Both companies are part of the HC Kothari group, ScanX reported.
According to financial figures as of March 31, 2026, Kothari Sugars and Chemicals reported a net worth of Rs 29,562.41 lakh and a turnover of Rs 24,678.07 lakh. Kothari Petrochemicals posted a net worth of Rs 37,225.53 lakh with a turnover of Rs 59,138.67 lakh.
The companies said the amalgamation is expected to reduce duplication in administrative and operational expenses while strengthening the combined business financially and creating economies of scale.
Kothari Sugars and Chemicals is engaged in the production of sugar, industrial alcohol and power co-generation. Kothari Petrochemicals manufactures Polyisobutylene, which is widely used in lubricants, fuel additives and rubber manufacturing.
Under the merger plan, there will be no cash transaction. The share exchange ratio has been fixed at 1:5 based on a valuation report prepared by KPMG Valuation Services LLP and a fairness opinion issued by Saffron Capital Advisors Private Limited.
As per the approved ratio, shareholders of Kothari Sugars and Chemicals will receive one fully paid-up equity share of Rs 10 each in Kothari Petrochemicals for every five fully paid-up equity shares of Rs 10 each held in KSCL.
The merger will also slightly alter the shareholding pattern of Kothari Petrochemicals. Before the amalgamation, promoters held 72.22 percent in the company while public shareholders owned 27.78 percent. After completion of the merger, promoter holding is expected to rise marginally to 72.50 percent, with public shareholding reducing to 27.50 percent.