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Grasim to buy chemicals biz of KPR Industries for $35 mn

By TEAM VCC

  • 18 Feb 2019
Grasim to buy chemicals biz of KPR Industries for $35 mn
Credit: 123RF.com

Grasim Industries Ltd, a part of the Aditya Birla Group, on Monday announced that it had signed a definitive agreement to acquire the chlor-alkali business of KPR Industries (India) Ltd for Rs 253 crore ($35.4 million at current exchange rates) in a cash deal.

Chlor-alkali refers to an industrial process for the electrolysis of sodium chloride, which in turn produces caustic soda -- a critical input in the aluminium sector. 

In a stock-exchange filing, Grasim Industries said the transaction would be funded via internal accruals.

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KPR will use the proceeds for a full and final settlement of lenders' dues, it added. 

Grasim said the business consists of an under-construction chlor-alkali project at Balabhadrapuram in Andhra Pradesh. 

"Given the expansion plans for the aluminium businesses, it will serve as an excellent sourcing point for leading aluminium players," said Santrupt B Misra, chief executive of Birla Carbon Business. 

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Grasim also said that the acquisition was in line with its strategy to strengthen its operations in eastern India. 

The transaction is subject to regulatory approvals. 

The chlor-alkali division of Grasim currently operates seven plants across India. The company claims to be the largest chlor-alkali player in India. 

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Grasim Industries is the flagship company of the Aditya Birla Group. It started out as a textiles manufacturer in India in 1947. It now specialises in manufacturing cotton-like material Viscose Staple Fiber (VSF).

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