Acquisition significantly increases RHI Magnesita’s presence in the fast-growing Indian refractory market
RHI Magnesita today announces the completion of the acquisition of the Indian refractory business of Dalmia Bharat Refractories Limited (DBRL) via a Share Swap Agreement executed on January 5, 2023. Consequently, Dalmia OCL Limited (DOCL), the Indian refractory business of DBRL, stands as a 100% subsidiary of RHI Magnesita India Limited, effective the same day. DOCL is one of India’s leading refractory players and a long-term trusted partner to customers in the region.
Through the consolidation of DOCL’s production into RHI Magnesita’s existing operations in India, significant network optimization synergies will be captured. The integration will add almost 300,000 tons of capacity annually to the existing production footprint in India, particularly in various shaped and unshaped refractories. This marks another decisive step in RHI Magnesita’s strategic growth plans in this key market and will enable the integrated company to increasingly serve customers with a ‘local for local’ approach while offering a broader range of products.
Stefan Borgas, CEO of RHI Magnesita, said: “The integration of DOCL into our RHI Magnesita India business will result in us further strengthening our position as a responsible market leader in India, building it as the growth hub for the wider region. We are investing in technological advancement across the value chain to make our network in India more modern and sustainable. The integration will open opportunities for us to create a talent pool in India that is ready to serve the global refractory industry.”
Parmod Sagar, CEO of RHI Magnesita India, said: “We will synergize and combine our common strengths to serve our stakeholders more efficiently. We have already kicked off a project to fully integrate people, products and processes of the two companies to offer enhanced value to customer through service optimization. The integration will result in increased value for all stakeholders of the integrated company.”
It may be noted that on November 19, 2022, the company had announced that it will acquire the Indian refractory business of DBRL. Under the terms of the Share Swap Agreement, RHI Magnesita India Limited would acquire all outstanding shares in DOCL in exchange for 27 million new shares in RHI Magnesita India Limited. Based on the closing share price of RHI Magnesita India Limited on 18 November 2022 of ₹645.35 per share, the Consideration Shares had a value of approximately ₹17,424 million (€212 million).