Dalmia Bharat - Divestment Of Non-Core Asset Continues: Motilal Oswal

Motilal Oswal Report

Dalmia Bharat Ltd. has entered into a binding agreement to sell its entire 42.36% stake in Dalmia Bharat Refractories Ltd., an associate company, to Sarvapriya Healthcare Solutions, a promoter group company, for a total consideration of Rs 8 billion. This deal will be consummated within 30 days.

The consideration will be received as:

1. Rs 1.6 billion on deal completion, and

2. Rs 6.4 billion converted into non convertible debentures carrying a coupon of 8.5% per annum payable quarterly. NCDs are redeemable in two tranches of Rs 3.2 billion each, the first redeemable on or before December 31, 2023 and the second on or before September 30, 2024.

3. In January 2023, Dalmia Bharat sold its Indian refractories business to RHI Magnesita India through a share swap. RHI valued Dalmia Bharat’s Indian business at 24 times FY22 enterprise value/Ebitda. Accordingly, Dalmia Bharat's stake in Dalmia Bharat Refractories was valued at Rs 8.9 billion.

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