GHCL acquires soda ash business in Romania

GHCL Ltd has acquired a majority stake in S C Bega Upsom SA, a leading soda ash manufacturer in Romania in an all cash deal through its international subsidiary.

The company has acquired a controlling stake of 65 per cent in the Romanian firm at $19.50 million with a requirement to make a public offer to purchase the balance35 per cent by the local Romanlan regulations. The company says that it has made the acquisition at a highly competitive cost. A similar capacity acquisition in India would have come at double the price of this acquisition.

With this acquisition, GHCL's global soda ash manufacturing capacity will increase by 300,000mtpa to 900,000mtpa. The acquisition has been financed through the recent FCCB issue of $80.5 million.

According to Sanjay Dalmia, chairman, GHCL, "This acquisition is a first step towards attaining leading position in the global soda ash industry with a strong presence in the European markets. Romanian acquisition would provide us with the comprehensive knowledge of the European markets keenly required for a robust growth strategy of ours."

Dalmia also said that GHCL would leverage and replicate its Indian experience to make this plant as the lowest cost producer of soda ash given its strategic location to tap east and Central European Markets which have substantial high level of reserves of Natural resources required to produce Soda Ash.

In addition to acquiring this plant, GHCL and its subsidiary has also entered into an MoU to acquire majority stake in the only other soda ash plant in Romania. Upon completion, its capacity in Romania will go up to 700,000mtpa and its global capacity increase will be 1,300,000mtpa.