Key Sentence:
- Indorama Ventures, a chemicals producer controlled by billionaire Aloke Lohia, has signed a $1.3 billion deal with Brazilian industrial conglomerate Ultrapar Participacoes to acquire its chemicals division.
Indorama Ventures announced Monday that it has agreed to acquire Oxiteno. The Sao Paulo-based subsidiary of Ultrapar makes ethylene oxide and its derivatives. With Oxiteno’s network of 11 manufacturing facilities in Latin America and the United States. Indorama Ventures said the acquisition would help build an excellent management team, strong customer relationships, and significant growth potential in attractive end markets.
The adjustable transaction will be funded through deferred payments, free cash flow, working capital, and debt, Indorama Ventures said. It is expected to end in the first quarter of 2022.
“This takeover is, of course, for us,” Lochia said in a statement. “With Oxiteno, we are creating a world market leader in surfactants.”
In 1995 the Lohia family established Indorama Ventures’ first manufacturing facility in Thailand. Because then, the company has become one of the largest producers of polyethylene terephthalate (PET), a chemical widely used in food and beverage packaging.
Indorama Ventures claims to have completed at least 50 acquisitions to expand its presence in 34 countries in the last two decades. The company posted 52% annual revenue growth to $3.6 billion in the second quarter. Thanks to the economic recovery from the pandemic. It also reported a net profit of $267 million for the same period, up 5,000% from a year earlier.
“From our first PET line in 1995, through solid experience acquiring and integrating new lines and teams. We have grown into our current global leadership position that gives us size and edge in the market. Lohia said in a statement Monday. This 62-year-old man also serves as Vice President and CEO of Indorama Ventures Group.