The Swiss multinational specialty chemicals company, Clariant AG has entered into a Joint Venture (JV) with Bhartia family-owned India Glycols Limited (IGL), engaged in the manufacturing of green technology-based chemicals.
The Board of Directors of India Glycols at its meeting held on 11th March 2021 has given approval for the execution of the transfer agreement of the company’s Bio-EO (Speciality Chemicals) Business to IGL Green Chemicals Private Ltd. (IGCPL), a wholly owned subsidiary. The committee also announced the formation of joint venture between IGCPL and Clariant. As per the agreement, the strategic partnership would be a 51:49 joint venture in renewable ethylene oxide (EO) derivatives wherein 51% stake will be held by Clariant and the remaining 49% stake will be held by the company.
The JV would include the transfer of India Glycol’s renewable Bio-EO (Ethylene Oxide) Derivatives business including a multipurpose production unit such as an alkoxylation plant located in Kashipur, Uttarakhand. While Clariant will be contributing its industrial and consumer specialties business in India, Sri Lanka, Nepal & Bangladesh, handled by Clariant India Ltd. The newly formed joint venture is being viewed as an emerging leader in the supplies of renewable materials, to span the rapidly growing consumer care sector in India and its neighbouring territories. Mr. U.S. Bhartia, Chairman and Managing Director of India Glycols Limited (IGL) would be the designated chairman of the JV. Initially, the joint venture will have around 200 employees.
Clariant sees this JV as an opportunity to strengthen its current portfolio with growing focus on sustainability through its leveraging of “green” EO derivatives. In addition to widening its consumer base across the home care, personal care and industrial applications segments, the company is optimistic of its profitable growth amid growing organic demand for EO Derivatives and the world’s strong inclination for renewable products.
India Glycols Ltd. is currently the largest producer of “green” EO in the world. As per the pact, IGL has agreed to produce Ethylene Oxide via green process utilizing bio-ethanol in addition to providing other utilities. The partnership is a strategic move to expanding company’s footprints in the global markets through its growing strength in the development of complex and sustainable chemistry thereby benefiting its shareholders.
As per ChemAnalyst,” India’s current Ethylene Oxide capacity stands at around 1850 KT. Ethylene Oxide derivatives are globally utilized to produce a wide range of products. Ethylene glycols (mono-, di-, triethylene glycol) held the largest market share in the Indian Ethylene Oxide industry, accounting for over 92% of the EO market in 2020. Green Ethylene Oxide produced by IGCPL would serve as a useful alternative to petroleum-based Ethylene while the world is swiftly transitioning to renewable technologies to facilitate chemical production.”