Apollo Seals Deal To Buy Out Nocil Rubber Division
Apollo Tyres of the Onkar S Kanwar group on Wednesday signed an agreement with Mafatlal Industries Ltd and its associates to acquire the latter's stake in the rubber chemicals division of Nocil for a total consideration of Rs 55 crore.
The Mafatlals will initiate action to separate the rubber chemicals division of Nocil.
An agreement has already been signed between Mafatlals and Montell & Shell to create a joint venture for the petro-chemicals business in which Shell is expected to infuse funds through the foreign direct investment (FDI) route.
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Nocil's rubber chemicals division will be hived of as a new company _ Pololefins Rubber Chemicals Ltd _ giving effect to a scheme of de-merger of Nocil after approval by the high court.
The Mafatlals will divest approximately 42 per cent of their holding in the newly created rubber chemicals company in favour of Onkar S Kanwar. J M Financial and Enam Financial were advisors to the transaction.
The rubber chemicals division has been a significant exporter to the Asia-Pacific, Europe and North and South America.
The entire rubber chemicals division, being taken over by Kanwar, has received the ISO 9002 certification from BVQI, London.
The thrust of the new company will be more on the international market.
The management envisages that in three years the company would corner a significant share of the international market.
It is envisaged that the company would continue to function independently under a professional management.
Also, the new rubber chemicals company will continue to follow the policies of the erstwhile rubber chemicals division of Nocil.
The acquisition marks the entry of the Onkar S Kanwar group in the business of the speciality chemicals. The group has chosen speciality chemicals as a focus business besides tyres.