Neogen Chemcials surges nearly 4% on plans to acquire BuLi Chemicals

Shares of Neogen Chemcials surged nearly 4 percent in the opening hours on March 6 after the company announced its plans to acquire 100 percent stake in BuLi Chemicals India from Livent US Corporation for Rs 25 crore.

At 10.50am, the shares of Neogen Chemcials were trading at Rs  1,340.50 on the National Stock Exchange, up 3.91 percent.

BuLi Chemicals possesses key technology to manufacture N Butyl Lithium and other organolithium products using Lithium metal, which are essential reagents for Lithiation reaction employed in manufacturing complex pharmaceutical and agrochemical intermediates.

In addition to this, BuLi Chemicals supplies N Butyl Lithium to several leading pharma and agrochemical companies in India and worldwide.

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According to ICICIdirect, Neogen's brokerage firm, since the inorganic (lithium) segment contributes 20-25 percent of Neogen's total revenue, the acquisition of BuLi Chemicals will expand its portfolio and enhance its advanced intermediates and clinical supplies management manufacturing business by providing organolithium derivatives to the current pharmaceutical and agrochemical industries.

ICICIdirect sees the possibility of Neogen becoming one of the top players in lithium chemistry due to its capital expenditure statement for battery chemicals such as salts and electrolytes.