Tata Chemicals – acquires yet another soda ash company

Tata Chemicals Ltd (TCL) has
acquired 100% stake in US-based General Chemical Industrial Products (GCIP) for $1.005 billion (Rs 4000 crore). GCIP is a privately held debt free company with revenues of $400 million and has a robust bottomline. TCL would be buying out Harbinger Capital Partners, which is a private equity firm that owns a majority stake in GCIP.

GCIP’s natural soda ash facility in Wyoming will add about 2.5 m tonnes (mt) to Tata Chemicals existing capacities of 2.9 mt spread over Mithapur, Norwick (UK), Netherlands and Lake Magadi (Kenya). The natural soda ash manufacturing via trona ore deposits route carries significant cost advantages over the synthetic route. The scaling up of facilities comes at a time when the global soda ash cycle is strengthening due to ongoing construction activity in Asia and China’s huge domestic demand. About 40% of TCL revenues are from international sales and it has 14% share of the global market.

Tata Chemicals has posted a 7% rise in net profit at Rs 125 crore for the quarter ended December 31, 2007 against Rs 117 crore in the same period in 2006.