SIDL has extended soft loan upto $ 40 million at 0% interest for a period of 15 years to set up a disinfectant unit.
Dishman Arabia Ltd is planning to tap the $ 500-700 million disinfectants to cater to the oil production companies in Gulf region by entering into a joint venture with them.
Dishman Arabia is a 50:50 joint venture between Ahmedabad-based Dishman Pharmaceuticals & Chemicals and Saudi Arabia-based Takamal.
“There is huge potential for disinfectants in the oil sector. Dishman Arabia is in talks for a joint venture with the flagship company comprising of majority of the oil production companies in Saudi,” said JR Vyas, managing director of Dishman Pharmaceuticals.
The flagship company has oil companies from as many as 18 Gulf Cooperation Council (GCC) nations, he added while refusing to divulge name of the company.
The presence of water in oil exploration leads to bacteria formation besides there is conversion of nitrogen to nitric acid. Dishman proposes to develop special disinfectants that will clean them up, according to Vyas.
Dishman Arabia has meanwhile decided to pump in about Rs 100 crore for setting up a formulations unit in Riyadh to produce disinfectants. Dishman Arabia is chaired by Takamal chief who is also the UN ambassador to Saudi Arabia, said Vyas.
While Dishman and Takamal have each invested Rs 25 crore in the JV company, the Saudi Industrial Development Fund (SIDL) has extended soft loan upto $ 40 million (Rs 200 crore) at 0% interest for a period of 15 years.
Dishman Arabia has already been allotted 40,000 sq m of land in Riyadh and the upcoming unit will commence production of the unit by end of 2009.
The unit will also produce disinfectants for hospitals and hygiene disinfectants for hotels and restaurants.
Dishman Pharma already supplies disinfectants to oil companies in India. ONGC which requires about 10,000 tonnes of disinfectants every year also sources a considerable part of it from Dishman.
Dishman group is planning to clock a turnover of about Rs 1,000 crore this year and about Rs 1250 crore in the year next.
