Saint-Gobain Glass India – new acquisition in West India
On 31st May 2011, Saint-Gobain Glass India Ltd (SGG I) has entered into a definitive, binding Business Transfer Agreement with Sezal Glass Ltd (Sezal) to acquire its Float Glass Business as a going concern on a slump sale basis. Sezal’s Float Glass plant located in District Bharuch in Gujarat has the capacity to produce 550 metric tons of float glass per day. The modern Float Glass plant built with European Technology commenced commercial production in May 2010. SGG I was presented with the opportunity for the acquisition when the Promoters of Sezal decided to exit the Float Glass Business.
Along with the existing World Glass Complex at Sriperumbudur in South India and the upcoming new World Glass Complex at Bhiwadi in North India, this strategic acquisition will give a Pan-India manufacturing footprint to SGG I.
SGG I is a 100% subsidiary of Compagnie de Saint-Gobain, which is headquartered in Paris (Net Sales - 40.1 billion Euros in 2010). Saint-Gobain, the world leader in the Habitat and Construction markets, designs, manufactures and distributes building materials, providing innovative solutions to the challenges of growth, energy efficiency and environmental protection. Operating in 64 countries with over 190,000 employees, Saint-Gobain features 132 in the Fortune 500 list in terms of sales turnover (2010 Global 500), and is among the 51 top companies in Carbon Disclosure Leadership Index.
The Indian Glass Industry has been growing at about 10% pa in the past decade. The drivers of growth have been the Architectural and Automotive sectors. The past decade has seen not only sustained growth rates in the market but also significant cost inflation in fuel, raw materials, freight and overheads. This has impacted the profit margins of the industry.
In Saint-Gobain’s view, these twin factors – consistently growing market with an evolving product mix and rapidly escalating input costs – imply a strategic need to develop diversified, geographically well-balanced and integrated manufacturing complexes across India. Such a strategy will help on the customer front, through proximity to market, better service levels and diversified product mix. It will also help in improving logistics and de-risking the business.
The acquisition in West India is clearly in line with this strategy.
SGG I manufactures and markets a wide range of flat glass products and solutions. It commenced operations in the year 2000, has invested cumulatively over Rs 1600 crores in the World Glass Complex, at Sriperumbudur, 46 kms from Chennai and has achieved technological and market leadership in a highly competitive industry.
Saint-Gobain Glass India – New World Glass Complex under construction in North India
SGG I is investing around Rs 1000 crores in Bhiwadi, Rajasthan, about 65 km from Delhi. This new World Glass Complex will serve North India and will commence operations in early 2012.
The acquisition in Western India strengthens SGG I’s manufacturing capability. It will also significantly improve the servicing of western India, lower overall logistics cost, improve efficiencies, enhance product mix, reduce carbon footprint and help in servicing the export markets of Middle East.
SGG I is confident that the new investment will see significant value addition by becoming part of the Saint-Gobain group. A wide range of initiatives are planned to improve operational efficiencies, reduce purchasing costs, lower interest costs, reduce carbon footprint and increase output through balancing investments. SGG I plans to make further investments in the new acquisition to scale up the product quality to Saint-Gobain’s global standards and enable manufacturing of value added products.
With this acquisition in Gujarat, for the Saint-Gobain Group, India will become a very important axis of growth, investment and innovation for Flat Glass.
Saint-Gobain Glass India’s journey towards becoming the Clear Choice for Glass Solution continues to gather momentum.
Anand Y Mahajan
General Delegate - India, Sri Lanka, Bangladesh
Compagnie de Saint-Gobain
Chairman, Saint-Gobain Glass India Ltd.
President – Flat Glass, SouthAsia,Egypt 31st May 2011
Managing Director – Saint-Gobain Glass India Ltd chennai