Huntsman firms up acquisition of Indian chemicals business

By Simon Pitman

- Last updated on GMT

Texas-based Huntsman Corporation has confirmed an investment in Indian Petrochemicals player Laffans, eight months after first announcing its intentions to buy.

Huntsman says it has now taken ownership of Laffans 60kt ethylene oxide derivatives facility in Ankelshwar, in the Gujarat state, which is in the North Western part of the country.

The purpose-built facility manufactures and supplies petrochemical-based specialty intermediaries to the personal care industry worldwide, as well as the agrochemicals, household and automotive lubricant sectors.

Although the company did not confirm the cost of the transaction or any other details, it has managed to meet with all the necessary regulatory issues.

Getting closer to the India market

“A stronger manufacturing presence in India will enable us to better support our customers and their growth specifically within the Indian economy,”​ said president of performance products division Daniele Ferrari, when the acquisition was first announced in August last year.

The company expects the acquisition to occur in the first half of 2011 and be accretive almost immediately, so the results will impact the company's performance in the next three quarters.

In taking on the business, Huntsman expects its sales in India to reach approximately $260m which is about 3 per cent of its total revenues. The Laffans chemicals business is estimated to have annual sales of about $45m.

Complementing existing technology and product offerings

According to Ferrari, the acquisition is expected to both complement the existing technology and product offering, as well as introduce new potential for product development.

Last year Huntsman had a $9.2bn turnover and recorded a net profit in excess of $50m, a performance that has prompted the company to expand its operations in the fast-growing Asian market.

The acquisition of the Laffans business comes on top of another recent announcement that Huntsman will make a $70m investment in a capacity expansion program at its polyetheramine plant in Singapore.

Related topics: Business & Financial

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