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Nirma sets eyes on world’s fourth largest soda ash producer

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EW YORK: Just a year after its biggest buyout ever—the takeover of the Indian cement portfolio of Lafarge for $1.4 billion, trumping bigger rivals Piramal and JSW—Nirma has set its eyes on an acquisition in the US.

NirmaBSE 0.06 % has emerged as a key contender for Tronox Alkali in Green River, Wyoming, the fourth largest producer of soda ash in the world, for $1.5-2 billion, said multiple sources aware of the ongoing negotiations.

If successful, this will be the largest in the history of the 48-year-old company, one that will help it scale up and transform itself into a global force all at once.

“Nirma made a binding offer after detailed diligence. Their team was in the US recently. This is the second time they are having a go at this asset, so they are pursuing it very seriously,” said an executive. “They are the only Indian (entity) left in the fray.”
Soda ash or sodium carbonate is a commodity used mainly in the glass, detergent and food processing industries. Nirma is the largest soda ash producer in India followed by Tata Chemicals and Gujarat Heavy Chemicals Ltd (GHCL). In February, Tronox decided to sell the alkali chemicals business.

The development came after the NYSE-listed Tronox announced a definitive agreement to acquire Cristal TiO2, the world’s second largest producer of titanium dioxide.

Proceeds from the Tronox Alkali sale were to be used to help fund the acquisition of Cristal, a privately held global chemical and mining company, for $1.673 billion of cash and Class A ordinary shares, Tronox said in a public statement. It mandated Credit Suisse to run a formal sale process, anticipating a closure in the second half of 2017.

The business was originally part of the soda ash operations of FMC Corp., which ran it for 65 years as a core part of its sprawling business. It divested the unit in 2015 to Tronox for $1.64 billion. Nirma made an unsuccessful bid for the business at the time, experts said.

The business was originally part of the soda ash operations of FMC Corp., which ran it for 65 years as a core part of its sprawling business. It divested the unit in 2015 to Tronox for $1.64 billion. Nirma made an unsuccessful bid for the business at the time, experts said.

Tronox Alkali produces soda ash from two operations in the Green River area of Wyoming, employing about 1,000 and generating $800 million in revenue. The business accounts for around 22% of global natural soda ash capacity and over 5% of the total production of the chemical.

The capacities are divided between the Westvaco (3.2 million tonnes) and Granger (0.5 MT) operations. In addition to soda ash, the Westvaco operation is also a major producer of other sodium chemicals including sodium bicarbonate. There was no response to emails sent to Tronox and Nirma on Friday and Saturday, respectively.

Nirma sets eyes on world’s fourth largest soda ash producer Reviewed by on .   EW YORK: Just a year after its biggest buyout ever—the takeover of the Indian cement portfolio of Lafarge for $1.4 billion, trumping bigger rivals Pirama   EW YORK: Just a year after its biggest buyout ever—the takeover of the Indian cement portfolio of Lafarge for $1.4 billion, trumping bigger rivals Pirama Rating: 0
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