Saint Gobain Glass has Diversified its Production Facilities in India

Saint Gobain Glass has Diversified its Production Facilities in India

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Saint Gobain Glass has Diversified its Production Facilities in India


Acquiring Electrotherm’s iron pipes business

Saint Gobain Glass India Ltd is not a listed company in Indian stock exchanges. It is a hundred per cent subsidiary of the French float glass producer Saint Gobain. Now Saint Gobain has decided to acquire ductile iron pipes business of Electrotherm India at an investment cost of around Rs.1000 crore. Electrotherm India is selling this business unit to Saint Gobain for two reasons. The first reason is to reduce its debt burden. The second reason is to concentrate in its core business of engineering and steel. Saint Gobain will also acquire 100% stake in Electrotherm’s subsidiary that runs the pipes business. Electrotherm’s pipes division has an installed capacity of 192000 tonnes, out of which the actual production is around 83000 tonnes.

Rs.1200 crore investment

Saint Gobain is one of the leading manufacturers of building materials in the world. Saint Gobain is also global leader in ductile iron pipes. Saint Gobain is planning to invest Rs.1200 crore in various projects in India over a period of two years. Saint Gobain is setting up a manufacturing unit in Bhiwadi in Rajasthan with a capacity of three lakhs tonnes per annum at a cost of nearly Rs.1000 crore in phases. During the first phase, the company will be investing Rs.800 crore in the current year. B. Santhanam is the Managing Director of the company’s Indian operations. The Bhiwadi unit will commence production in the first half of the current year 2012. Saint Gobain is also planning to invest Rs.100 crore in its newly acquired company Sezal Glass in Gujarat. For this $140 million worth of equity is involved.

Searching for land in Tamil Nadu for new project

Saint Gobain has set up its plant in Sriperumpudur near Chennai in Tamil Nadu for the manufacture of float glass for automotive and architecture industries. Saint Gobain plans to invest Rs.100 crore in this unit. Saint Gobain is confidant of cutting costs on logistics with this geographical diversification of its three plants. The growth of the company at 23% last year outpaced the growth of glass industry in India at 10%. Saint Gobain wants to set up its first solar glass complex. For this the company is scouting for land in Tamil Nadu. The investment cost in the projected is estimated at around Rs.500 crore. The company is reluctant to use its reserve land in Sriperumpudur amounting to 50 acres as it has earmarked this land for future expansion of float glass manufacturing for automotive industry. Saint Gobain is searching for 60 acres of land separately either in Sriperumpudur or in some other suitable place to set up its new solar glass project which will be 50% export-oriented. It is very difficult to get land in Sriperumpudur as it has already become an industrial hub of Tamil Nadu.

Competition for architecture students

There was one group company Saint Gobain Sekurit India Ltd which was listed in BSE. But the French promoters Saint Gobain Sekurit S.A. and Saint Gobain Glass India Ltd have delisted the company by acquiring 14.23% of the company’s floating shares through an open offer of Rs.31 per share. Saint Gobain conducted a design competition for architecture students in India styled as Transparence 2010 at Hubli in Karnataka. 600 students from 120 colleges participated in the event. Shomathew, Surikrishna and Shidarth of SPA College, New Delhi won the trophy.

Acquisition of Sezal Glass

Saint Gobain’s acquisition of Sezal Glass located in Bharuch district of Gujarat at a consideration of Rs.686 crore will add up the capacity of the company by 550 tonnes per day. Sezal Glass’s promoters decided to call it a day because of growing debt burden and reduced margins. Sezal Glass, for some reason, chose to appoint the scam-tainted PwC as its financial advisor for this deal. With this acquisition, Saint Gobain has presence in North India (Bhiwadi in Rajasthan), Western India (Gujarat) and South India (Sriperumpudur in Tamil Nadu). Saint Gobain started its Sriperumpudur plant in the year 2000. Sezal Glass started its operations in 2001 with a processing facility at Silvassa for toughened & laminated glass, speciality glass like and decorative glass for automotive & building industries. It integrated backwards with a facility for manufacture of float glass in the year 2008. It has the state-of-the-art machinery and technology from the world famous French company Stein Heurtey. Now Saint Gobain has acquired this business.

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