Rubamin acquires J&K Pigments

Rubamin, the country's largest zinc oxide maker, has acquired the Rs 100 crore J&K Pigments, another zinc oxide manufacturer located in Kathua district of Jammu & Kashmir, for an undisclosed sum.

Sources close to the development said the acquisition price might be in the region of the sales of the target company.

Atul Dalmia, managing director, Rubamin, said the acquisition would further consolidate the company's position as the largest zinc oxide producer in the country. He, however, refused to divulge the cost of the acquisition.

J&K Pigments' zinc oxide manufacturing capacity stands at 4,800 million tonne a year. Post-acquisition, Rubamin's capacity will increase to 28,200 million tonne per annum.

"We are well on our way to becoming one of the major producers of zinc oxide in the world by 2010," he said.

Zinc oxide manufacturing in the country is growing strongly on the back of a boom in the tyre, rubber and ceramic industries. Worldwide, the market exceeds a million tonne, making it a $3 billion (Rs 13,500 crore) sector. Zinc supply is forecast to trail its demand till 2010, which will ensure substantial growth in profits.

The acquisition also provides the Rs 360-crore Rubamin with a base in J&K, where it enjoys tax incentives.

The Vadodara-based company has facilities in Halol, Daman and J&K. It also has a wholly owned subsidiary in Congo, which is engaged in mining, exploration and trading.

Rubamin is a star export house, with exports around the world, and it boasts of high-profile customers like Phelps-Dodge, Codelco and Bridgestone. Rubamin has been consistently rated one of the best vendors for these companies.

Within the country, the company is a supplier to leading companies such as MRF, Apollo Tyre and Lubrizol.

Rubamin has a nationally recognised R&D centre and apart from zinc oxide, it also manufactures cobalt salt. There are only a few companies in cobalt salt manufacturing.

The technology has been developed within the company. Rubamin produces 23,400 million tonne of zinc oxide a year and 600 million tonne of cobalt salt and 5,200 million tonne of copper salt.