US-based Worthington Industries today picked up 60 per cent stake in Nitin Cylinders, a wholly-owned subsidiary of Nitin Fire Protection Industries, for around $21 million. After the deal, the subsidiary will turn into a joint venture between Nitin Fire and Worthington which is in the business of manufacturing pressure cylinders.
Nitin Cylinders (NCL) is one of the largest manufacturers of compressed natural gas (CNG) cylinders in India. The company manufactures high pressure seamless steel cylinders ranging from 232 to 406 mm diameter. These cylinders are used in CNG storage in motor vehicles and compressed industrial gas.
"The joint venture will help Nitin Cylinders benefit from the global experience and technical capabilities of Worthington group. It will help the business grow for CNG and industrial cylinders both international and domestic markets," said Nitin Shah, Chairman, Nitin group.
The company has a manufacturing facility at Vishakhapatnam Special Economic Zone in Andhra Pradesh. It has an installed capacity of 5,00,000 cylinders per annum and annual sales of $11 million. NCL exports its cylinders to countries like United Arab Emirates, Pakistan, Bangladesh, United Kingdom and Malaysia.
"Our partnership will give us the opportunity to expand presence in the emerging markets of India. This joint venture will also strengthen our product offering in the growing clean power storage market as alternative fuel use gains momentum internationally for economic and environmental reasons," said Mr Harry Goussetis, President, Worthington Cylinders.
Ernst & Young were the bankers to the deal, while AZB & Partners and Quest Profin Advisors were the lawyers and financial advisors for this transaction.
