EIL in talks to acquire Lurgi unit

Engineers India Ltd has initiated talks with Lurgi AG, a global technology leader in process and plant engineering, to acquire a division of the German giant.

Sources said an expression of interest submitted by Engineers India Ltd (EIL) had received "positive response" from the Frankfurt-based company.

The sources, however, declined to give further details, including information on which division of Lurgi was being examined by EIL, on the plea that both the firms had signed a confidentiality agreement to keep the deal a secret. EIL offers services for pipelines, oil and gas processing, offshore structures and platforms, fertilisers, metallurgy, and power.

It has received the nod from the oil ministry for the proposed acquisition.

Industry analysts said the funding of the acquisition would not be a problem for the cash-rich public sector unit. Engineers India had reserves and surplus of Rs 863 crore on March 31, 2005.

Lurgi has been in India for quite some time through its Indian subsidiary Lurgi India. In addition, its associate Zimmer AG has got equity participation with the Kolkata-based Dhunseri group in a PET resin manufacturing company at Haldia in West Bengal.