IFGL Refractories buys 2 US cos for Rs 59 cr

Sep. 13, 2010 - Refractory manufacturer IFGL Refractories has acquired two US-based firms-EI Ceramics and CUSC International-for $13 million (about Rs 59 crore), to build a presence in one of the world's largest markets for steel. IFGL's wholly-owned US subsidiary IFGL Inc agreed to acquire the two companies in a transaction completed late last week.
EI Ceramics designs, manufactures and supplies alumina graphite continuous casting refractories to several steelmakers in North America, while CUSC provides ancillary services including processing of raw materials, warehousing and packaging to EI Ceramics.
"The acquisition will help us strengthen our foothold in America. The two firms will play a pivotal role in our expansion plans. Moreover, CUSC also owns about 2.74 acres of land with a built-in warehouse", said Pradeep Bajoria, IFGL's managing director.
The move is part of IFGL's plans to power its growth in the global market. It had earlier made two acquisitions in Europe-Monocon International Refractories in 2005 and Hoffmann Ceramics in 2008.
As per the agreement with EI Ceramics and CUSC, the day-to-day operations of the two companies will continue to be looked after by the current team and several key employees drawn from the two companies. Jim McIntosh, who has experience in technical marketing and commercial aspects of the industry, will continue as president.
"IFGL Refractories intends to use the newly acquired facilities to cater to the demand of its customers as well as grow its customer base in the US", said Mr Bajoria.
"This apart, we also intend to use our network to sell in South America including Brazil and Argentina". Existing customers of IFGL in the US, Canada and Mexico will have access to EI Ceramics' high performance products.Post acquisition, IFGL plans to enhance the capacity utilisation of the two companies over two years.