aditya birla nuvo columbian chemicals
TRANSCRIPT
Acquisition of Columbian Chemicals
by Aditya Birla Group
Presented by:
• Carbon black is a material produced by the incomplete combustion of heavy petroleum products such as FCC tar, coal tar, ethylene cracking tar, and a small amount from vegetable oil.
Uses -:1.Coloring agent for ink and paints2.Resin and Film Coloring Agents3.Electric Conductive Agent4. Electronic Equipment Related Material
• A US$ 29 billion corporation, the Aditya Birla Group is in the League of Fortune 500
• It is anchored by an extraordinary force of 130,600 employees, belonging to 40 different nationalities.
• Over 60 per cent of the Group's revenues flow from its overseas operations. The Group operates in 27 countries
• Non ferrous material
• Cement• Textiles• Chemicals• Carbon black• Agribusiness• Mining• Ferro chem.• Insulators• Telecom• Financial services• IT-ITes• Retail• Trading solutions
• Financial Services – Birla Sun Life Insurance• Telecom – Idea Cellular• Fashion & Lifestyle - Louis Philippe, Van Heusen, Allen Solly and Peter England.• IT-ITes: Aditya Birla Minacs• Manufacturing
• Hi-Tech Carbon, the carbon black business of Aditya Birla Nuvo, caters to the tyre and non-tyre industry with a vision to be the most respected, green, globally-advanced fillers business.
• Hi-Tech Carbon is the second largest producer of carbon black in India, covering 37 per cent of the domestic market share.
• Manufacturing plants are at Renukoot in U.P and Gummidipoondi in Tamilnadu.
• The Aditya Birla Group produces approximately 780,000 tpa of carbon black.
• Internationally, the Group has carbon black facilities at its Alexandria Carbon Black unit in Egypt, Thai Carbon Black Public Company Limited in Thailand and Liaoning Birla Carbon Black unit in China.
• The Group derives synergies through marketing under the brand ‘Birla Carbon’ and central procurement of feedstock.
Established in 1860’s when carbon black was first utilised for industrial applications
In 1922, columbian emerged as a company from consolidation of small carbon black manufacturers.
Many “first” bought in the industry:1. First to produce carbon black to reinforce
rubber2. First to produce carbon black beads 3. First to produce coarse, fine, and very fine
furnace black 4. First to study the surface activity of carbon
black 5. First to study the absorptivity of carbon black 6. First to use electron microscopy to study
carbon black
In 1986, acquired by Phelps Dodge corporation
In 1999, opened itc current headquarter and technology centre in Marietta , Georgia
In March 2006, acquired by a company jointly owned by DC Chemicals Co. and One Equity Partners
In 2009, One Equity Partner became sole owner of columbain chemicals
Industrial Applications1. Registered trademarks Raven®,
Conductex®, and Copeblack® 2. Columbian carbon black offers benefits in
printing ink, coating, plastics Rubber Applications
1. Registered trademarks Furnex®, Statex®, and Ultra®.
2. Columbian rubber carbon black enhance rubber properties and used as filler in tires.
Friendly acquisition
Took 18 months to seal the deal
Birlas would be paying $ 875 million in cash
100% buyout
Deal closure expected by June-July 2011
ANZ, Bank AXM, HSBC, RBS, Stanchart: Financial Advisors for the deal
KPMG: Tax and accounting advisor
Purpose of deal is to give Birla Nuvo a competitive edge and become market leader
“This deal is in line with the vision of Birlas to be among the top three players in a given business”: Kumar Mangalam Birla
Earlier it was at Position 3 behind Cabot Corporation and Evonik Industries
Provide 14% share of 14.2 million tonne market of carbon black
Acquisition is in alignment with the group’s strategy
Benefits of achieving global footprints
Enable Birlas to enter higher margin segments
Help in procuring orders from international tyre brands like Goodyear, Bridgestone, MRF
It will get access to untapped markets
Advantage of cutting edge technology
32 patents of Columbian Chemicals are in pipeline
Get synergy benefits of $ 50 million annually
“Our goal is to become a USD 65 billion
Group by 2015 from USD 30 billion today. We expect your Company to contribute significantly to this growth and earnings.”
-Kumar Mangalam Birla