"Welspun Gujarat is in final stages of negotiations with Aziz Pipe to buy a little more than 50 per cent stake in the firm for Rs 250-260 crore," a person in the know of the development said. The valuation of the Saudi firm is around Rs 500 crore.
Wellspun, which is the second largest pipe producer (by large diameter) in the world, operates a 3.5-lakh tonne facility in Little Rock, Arkansas, US, and hopes to tap the lucrative Gulf market with the latest move.
It also operates a 1.65 mtpa plant in Anjar, Gujarat, which is being increased to 2.1 mtpa now.
Neither Welspun group spokesperson Akhil Jindal nor officials from Aziz Pipe could be reached for comments.
"After the acquisition, Welspun would have an annual production capacity of about 2.5 mt, the largest in the world," the source further said.
"Welspun mainly serves the oil and gas industry. It has been actively scouting for a partner in the Gulf region," the source added.