Indian Petrochemicals Corporation Limited (IPCL), along with several global giants, is interested in buying out state-owned Gujarat Alkalies and Chemicals Limited (GACL). GACL has two units in Vadodara and Dahej, and is the single largest producer of caustic soda in India, with a capacity of 820 tons per day.
The Gujarat government holds 36.72% in GACL through Gujarat Industrial Investments Corporation, Gujarat State Investment, Gujarat Mineral Development Corporation, Gujarat Industrial Development Corporation and Gujarat Maritime Board. Gujarat State Fertilizers and Chemicals and Gujarat Industries Power Company together hold another 3%. Hence, much will depend on the divestment plans of the Gujarat government and when it plans to initiate the process.
While the enterprise value of GACL is around Rs 2,300 crore, the actual price would depend on the due diligence and valuation exercise. The RIL group company will take part in the bidding process required for such divestment. This buyout will provide several synergies to IPCL- the most important being chlorine availability. Chlorine produced by GACL is the principal feedstock for the polyvinyl chloride (PVC) that IPCL manufactures.
09-May-06 
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