SRF acquires DuPont's global pharma grade HFC 134a refrigerant biz

SRF Ltd, one of the leading manufacturers of refrigerants in India, has signed a binding agreement on December 31, 2014 to purchase DuPont’s global 134a regulated medical pharmaceutical propellant business. This DuPont Fluorochemicals business is part of the performance chemicals segment which DuPont anticipates separating by mid-2015. The acquisition comes into force with immediate effect.
 
Under the transaction, SRF will own the DuPont Dymel brand and will also receive the technology and know-how for setting up its own current Good Manufacturing Practices (cGMP) facility for manufacturing HFC 134a pharma grade. As per the agreement, DuPont will supply SRF with product until SRF’s production facility is approved.
 
SRF is the only Indian manufacturer of HFC 134a and has developed indigenous technology to manufacture the product. For SRF, this transaction provides immediate access to DuPont’s technology, brand and customers, thus enabling an instant entry into the niche pharmaceutical segment at a global level.
 
SRF has two manufacturing facilities for HFCs in India. Through this transaction SRF would not only utilise its existing HFC 134a facilities better, but would also become one of the world’s few suppliers of the pharma grade of HFC 134a, a product with stringent purity and handling parameters, and superior margins.
 
In the long run, the access to the pharma segment will allow SRF to move up the value chain and cater to the growing demand for the pharma grade HFC 134a, which, as per the global health standards, is approved as a long-term environment friendly alternative propellant for a growing number of medical applications.
 
Additionally, with the possibility of some drugs going off patent by 2019, it is likely that India will witness a significant growth in the demand of pharma grade of HFC 134a and SRF, as the only Indian supplier of the product, looks well positioned to reap the benefits.
 
Ashish Bharat Ram, managing director, SRF Ltd, stated, “This acquisition is in sync with our long term strategy to move up the value chain and will enable us to enter the niche pharma product segment. The growth in the Metered Dose Inhalers (MDI) sector is expected to be reasonably robust in the years to come and with India playing a major role in this sector we are ideally positioned to take benefit of this opportunity. This will also offer great synergy with our existing HFC plants going forward.”
 
Providing a rationale for the transaction, Kathryn McCord, global business director, DuPont Fluorochemicals, said, “DuPont is making this move to enable a stronger focus on developing and commercialising the company’s new family of products. We believe this business is an excellent fit for SRF, which already supplies to the pharmaceutical industry.”