TCG acquires controlling stake in Indian unit of Mitsubishi Chemical

NRI entrepreneur Purnendu Chatterjee-led private equity firm The Chatterjee Group (TCG) has picked up a majority stake in Mitsubishi Chemical Corporation's (MCC) Indian unit in West Bengal for around Rs 322 crore ($48 million).

According to the share purchase agreement as mentioned on the MCC’s website, TCG will buy 5.8 billion shares (90% stake) of MCC PTA India Corporation (MCPI) with Mitsubishi retaining 600 million shares in the Haldia-based unit.

“The agreement includes two processes—conversion of the MCC loans to MCPI into common shares, and increase MCPI capital share with MCC as underwriter by the share transfer date, which is scheduled for the end of October this year. This will increase the percentage of the MCPI common shares held by MCC to a maximum of 99.4%,” the company said in a statement.

The Japanese major emphasised that after completion of the above capital increase, MCC will transfer all the shares except for a shareholding ratio of 9% to Chatterjee on the share transfer date. As a result, MCPI will become a non-consolidated affiliate of MCC. 

West Bengal Industrial Development Corporation (WBIDC) will also hold a small stake (at present 5%).

The Indian unit of MCC currently has an installed capacity of 1.27 million tonnes with a turnover of around Rs 6,000 crore. It has a workforce of around 1,100 people.

This is likely to be a strategic decision from Tokyo-based company to exit the commodity chemical business as the firm has also offloaded the PTA business in China, selling the plant to an oil refiner in Ningbo.

It has also decided to retain the Thailand facility that supplies to group firms and another unit in South Korea.

Founded in 1989 by Chatterjee, TCG is a US-based private equity firm, with investments and operations spanning several continents and industries. It prefers to invest in petrochemicals, pharmaceuticals, biotech, financial services, real estate and technology sectors in the US, Europe and South Asia.

TCG, according to Mitsubishi Chemical’s statement, has operating assets worth $900 million across the world.

Early this year, TCG has also emerged as the single-largest shareholder in Haldia Petrochemicals Ltd after the former paid Rs 653 crore for buying out 26 crore shares from WBIDC.

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