Graphite electrode maker Graphite India Ltd has agreed to acquire a 46% stake in US-based General Graphene Corporation for up to $18.6 million (about Rs 132 crore) in cash, the company said in a stock-exchange disclosure.
Graphite India will acquire the stake through its Netherlands-based wholly-owned subsidiary Graphite International BV.
The investment will be made in multiple tranches over two to three years based on the achievement of agreed milestones to commercially produce graphene sheets, a company statement said.
“Graphite India’s investment in General Graphene is in line with its longstanding strategy of focusing on high-end technologies. This initiative is expected to deliver meaningful growth in the long term once commercialisation of the product is achieved and will result in enhanced value creation for all the stakeholders,” said K K Bangur, chairman of Graphite India, in the statement.
Knoxville, Tennessee-based General Graphene has developed a proprietary technology to produce large, low-cost graphene sheets for commercial applications. The material is currently not available in commercial volumes.
Kolkata-based Graphite India is one of the largest producers of graphite electrodes in India. It has a manufacturing capacity of 98,000 tonnes per annum spread across four plants at Durgapur (54,000 MT), Bengaluru (13,000 MT), and Nashik (13,000 MT) in India, and Nuremberg in Germany (18,000 MT). It manufactures a full range of graphite electrodes.
The company’s consolidated net sales stood at Rs 3,266 crore in the year through March 2018, up from Rs 1,468 crore in the previous financial year. Net profit increased to Rs 1,032 crore from Rs 70 crore.
Investment bank Lodha Capital Markets acted as the financial adviser to Graphite India for this transaction.