Grasim signs production deal with Warren Buffett’s specialty chemicals company2 min read . Updated: 30 Oct 2020, 08:20 PM IST
- The deal is to manufacture and supply chlorinated polyvinyl chloride resin in India
- Lubrizol will invest in two phases to set up the plant while Grasim will contribute with the manufacturing expertise
Aditya Birla group’s Grasim Industries Ltd has entered into a definitive agreement with Ohio-based Lubrizol Advanced Materials, a subsidiary of Warren Buffett’s Berkshire Hathway, to manufacture and supply chlorinated polyvinyl chloride (CPVC) resin in India, with initial production expected in late 2022. This special type of polymer material that is widely used in hot and cold water pipes, will be manufactured at Chlor-alkali unit of Grasim located at Vilayat, Grasim said in a press release.
Construction of the near 100,000 tonne plant will take place in a phased manner, and once commissioned, it will be the single largest site capacity for CPVC resin production globally.
Lubrizol will bring in capital and technology and will invest in two phases to set up the plant while Grasim will contribute with the manufacturing expertise required for the project, Grasim said in an exchange notification. Grasim will provide land, materials and utilities and will receive commercial charges over and above costs, in lieu of managing the plant operations etc. The size of the investment by Lubrizol could not be immediately ascertained.
“This collaboration with Lubrizol Advanced Materials is part of our long-term direction to bring in world class technologies to India and additionally complements our growth strategy in Chlor-Alkali and Derivatives platform," Kalyan Ram Madabhushi, CEO – Global Chemicals & Group Business Head- Fertilisers & Insulators, Aditya Birla Group, said.
India is amongst the largest consumers of CPVC, primarily in the form of plumbing pipe and fittings, and growing needs for clean water in all residential and commercial buildings will drive continued growth, Grasim said. Lubrizol is the inventor and largest manufacturer of CPVC resin and CPVC compounds worldwide. “With billions of feet installed globally, Lubrizol’s CPVC solutions enable long-lasting systems and reliable access to clean, safe drinking water to millions of homes, apartments and commercial buildings in alignment with the company’s mission to help the world Live Better. Lubrizol products have been instrumental in delivering safer water to some 200 million citizens in South Asia. This affiliation will also enable Aditya Birla Group and Lubrizol Corporation to explore opportunities across applications like water solutions, construction, textiles, automotive and piping by leveraging the technologies and market channels of both the groups," the exchange notice said.
“This alliance will help to better serve CPVC customers in India and South Asia, as well as support the Indian economy," Arnau Pano, Vice President, Lubrizol Advanced Materials, South Asia, said. “Connecting with Grasim Industries, a reputable global conglomerate, which shares our commitment to sustainable chemical production, will allow us to provide our customers with increased, reliable CPVC supply and further our goal of improving access to clean, safe drinking water for millions of global citizens."