International Finance Corp (IFC), the private sector investment arm of the World Bank, is investing $30 million (Rs 180 crore) through a combination of equity and
long-term debt in Lucid Colloids Ltd, one of the top four producers of guar gum.
The Lucid Group manufactures, markets and distributes natural, modified and derivatised hydrocolloids like guar, tamarind and cassia, gum blends, emulsifiers, food stabiliser systems, nutritional ingredients, food additives and ingredients, foodstuffs, agro commodities and fine chemicals.
Lucid Colloids, the flagship firm of the privately held group, plans to increase the production capacity and undertake backward integration. The company also plans to set up research facilities. These projects are in various stages of development and implementation.
The firm is implementing the projects at locations in Gujarat and Rajasthan, including at its existing manufacturing facilities in Jodhpur, Rajasthan.
"The investment will also enhance the global competitiveness of a mid-sized export-oriented player," said the company statement.
Born out of the restructuring of the erstwhile Indian Gum Industries Ltd (IGI) in 1999, Lucid has since then consolidated and expanded its operations and activities. IGI was established in 1958 as a financial and technical joint venture with Cesalpinia S.p.A of Italy and then later with Hercules Inc. of the US. In 1987, IGI became a fully Indian owned and managed company.
New Production sites are planned at Meglasiya (Rajasthan), Bikaner (Rajasthan), Jhagadia (Bharuch, Gujarat) and Aurangabad (Maharashtra).
For IFC, this would mark another bet in India after it committed $85 million in Varun Beverages, the largest bottler for PepsiCo in South Asia.
(Edited by Joby Puthuparampil Johnson)