Dishman may dilute Rs 500 crore equity from Swiss subsidiary for SEZ project.
Dishman Arabia is in talks with the world’s largest oil producer Saudi Aramco for a 50:50 joint venture to tap the huge potential in the disinfectant sector.
Managing director of Dishman Pharmaceuticals and Chemicals, JR Vyas confirmed to Business Standard that they are in talks with Aramco for a joint venture.
“There is a huge potential of about $ 500-700 million in disinfectants market in the Gulf region,” according to Vyas.
Dishman Arabia is a 50:50 joint venture between Ahmedabad based Dishman and Saudi Arabia-based Takamal.
The new firm is chaired by Takamal chief who is also the UN ambassador to Saudi Arabia.
Dishman Arabia has decided to pump in about Rs 100 crore for setting up a formulations unit in Riyadh to produce disinfectants that will also cater to hospital and hospitality sector besides oil and gas.
The Saudi Industrial Development Fund (SIDL) has extended soft loan up to $ 40 million (Rs 200 crore) at 0% interest for a period of 15 years. Dishman and Takamal have together invested about Rs 50 crore in the new company.
Dishman Infrastructure, a wholly owned subsidy of Dishman Pharma has meanwhile laid the foundation stone for its two upcoming SEZs near Ahmedabad in Gujarat.
The company, which has already spent Rs 80 crore for the acquisition of the land for both SEZs, plans to source the investment for its SEZs through external commercial borrowing of Rs 150 crore.
"We may later take the initial public offering (IPO) route and dilute equity for Rs 500 crore from our European subsidiary, Dishman Switzerland Limited, by 2010," Vyas added.
While the company has already acquired 300 acres land for its pharmaceutical and chemical SEZ, the land acquisition of 300 acres for its engineering SEZ at Bavla is on.
"We have signed 16 memorandums of association (MoUs) for engineering and about eight for the pharma SEZ. The total investment by all the units in the SEZ will be Rs 10,000 crores approx, generating direct employment for 50,000 people. Atleast some units in the SEZs will be fully operational by the year 2010," said Vyas,.
The company had received 12 and 17 letters of intent for its pharma and engineering SEZs respectively. Vyas had earlier told Business Standard that the SEZs have caught the interest of mostly mid-sized companies who want to control their supply chain.
The company planst to invest Rs 1000 crores in both the SEZ in the first phase, the SEZ developer also intends to bring some of the industrial units in the SEZ with an investment of Rs 750 crores.
The total export from these units will reach approximately Rs 1 lakh crores in the next five years.
