Dalmia-OCL, a part of Dalmia Bharat Group, Wednesday announced acquisition of German specialty refractory maker GSB Group GmbH for 15 million euros (nearly Rs 122 crore), which would help the company to expand in Europe.
With the acquisition, Dalmia-OCL will get access to the steel and refractory industry in Europe and technology to make cleaner steel.
Refractory is a specialised heat-resistant material used in making cement, steel, copper, aluminium etc.
GSB Group has two production sites -- at Bochum (Germany) and Bhilai (India).
Dalmia-OCL is betting on the growing steel demand in India, which would stimulate the consumption of refractories here.
"Dalmia-OCL's end-to-end refractory portfolio and GSB's access to European steel customers will make this combination a strong competitor in Europe," Dalmia-OCL CEO Sameer Nagpal said.
According to him, Dalmia Bharat Group is putting around 15 million euros for the acquisition and this would be funded with a "mix of debt and internal accruals."
Nagpal further said the acquisition will give the company newer resources and talents in Europe which will help strengthen "our capability in India, which is the fastest growing market for refractories in the world."
Domestic steel industry is expected to produce 300 million tonne per annum (MTPA) of steel by 2030 from the exiting 100 MTPA and this would provide a good opportunity to the company.
"Given the ambitious target, there is a huge demand for refractory and that is why we have started on this business aggressively," he said.
The company is targeting the growing consumption of high grade steel in various sectors, including automobile and home appliances industry.
Besides, Dalmia Bharat Group has plans to sell its products from India to Europe.
Dalmia-OCL is India's second-largest refractory company with a production capacity of 250,000 tonne a year.
The company expects a revenue of Rs 800 crore this year and 60 per cent of this would be contributed by the steel segment.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)