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MOSCOW (MRC) -- Haldia Petrochemicals
(HPL), a flagship company of The Chatterjee Group (TCG), along with
its international partner Rhone Capital has acquired US-based Lummus Technology
at an enterprise value (EV) of USD2.725 billion (around Rs 20,590 crore) from
McDermott International, reported Business Standard.
In the
joint acquisition, HPL’s share is at 57 per cent, the balance would be held by
Rhone Capital. Under the new dispensation, Lummus Technology would function
as a ‘standalone’ autonomous entity. The deal was completed on
Tuesday.
Lummus Technology is a master licensor of proprietary
technologies in refining, petrochemicals, gas processing and coal gasification
sectors, as well as a supplier of proprietary catalysts, equipment and related
engineering services. It has about 130 licensed technologies and more than 3,400
patents and trademarks.
Purnendu Chatterjee, founder chairman of TCG,
said, "Our investments are both strategic and long-term, most of which span
across 25 to 30 years. We have primarily focused on knowledge-based enterprises,
and Lummus is a great addition to our portfolio. Leading with innovation, it
delivers sustainable value to clients in areas of materials technology." "HPL,
being a long-term client of Lummus, can share its customer experience and
collaborate with Lummus to co-create innovations for the benefit of the
industry," Chatterjee added.
HPL is one of the largest petrochemical
companies in India, having its manufacturing facility in Haldia, West Bengal. It
has a total capacity of 700,000 TPA of ethylene. With the deal, Lummus and HPL
together would be in a position to provide a ‘value proposition’ to the clients
of Lummus in India and abroad. The divestment of Lummus is part of McDermott’s
restructuring process.
Leon de Bruyn, head of Lummus Technology, said,
"For our customers, employees and partners, this is an important milestone. We
would be able to focus exclusively on providing world class technologies and
solutions and developing long-term strategies that will allow Lummus to lead and
shape the future of our industry."
Rajnish Kumar, chairman, State Bank of
India (SBI), the lead banker in the deal, said, "Acquisition of Lummus, world’s
premier petrochemicals company by Haldia Petrochemicals, is a landmark
achievement by an Indian company. I hope this acquisition will go a long way in
furthering India’s strong footprint in technology space and support India’s
mission of Atmanirbhar Bharat."
As MRC informed earlier,
in late March 2020, India's private-sector Haldia Petrochemicals (HPL) shut
its naphtha cracker after ports in the country declared force majeure to prevent
the spread of the coronavirus.
Ethylene and propylene are feedstocks for
producing polyethylene (PE) and polypropylene (PP).
According to MRC's ScanPlast report,
Russia's estimated PE consumption totalled 595,170 tonnes in the first five
month of 2020, up by 10% year on year. Deliveries of all ethylene polymers,
except for linear low density polyethylene (LLDPE), rose partially because of an
increase in capacity utilisation at ZapSibNeftekhim. At the same time, PP
shipments to the Russian market was 457,930 tonnes in January-May 2020
(calculated by the formula production minus export plus import). Deliveris of
exclusively PP random copolymer increased.
Haldia Petrochemicals Ltd is a
modern naphtha based petrochemical complex at Haldia, West Bengal, India. Haldia
has played the role of a catalyst in emergence of more than 500 downstream
processing industries in West Bengal with a capacity to process more than
3,50,000 TPA of polymers, among which are PE and PP. Once identified by promoter
dispute and poor financial health, HPL turned around from 2015. Founded by
Purnendu Chatterjee in the mid-80s, the US-headquartered TCG now has a
controlling stake in HPL. TCG owns and controls companies as ‘long-term
investments’ in sectors like, petrochemicals, pharmaceuticals, biotech,
financial services, real estate and technology, serving global markets. |
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