By RAKESH SHARMA
NEW DELHI -- India's Gulf Oil on Wednesday said
it has agreed to acquire US-based specialty chemicals maker
Houghton International from a private-equity fund for about
The purchase - the largest overseas acquisition by an Indian company so far this year
- will be carried out by a wholly-owned UK unit, the
Hyderabad-based company said.
The agreement for the transaction with AEA Investors was
signed Tuesday but the takeover is subject to certain
conditions, Gulf Oil said, without elaborating.
It added that Houghton will continue to operate as a
separate company after the deal is completed.
"The acquisition fits very well with Gulf's lubricant
portfolio," the company said in a statement.
It added that its range of automotive lubricants will
complement Houghton's portfolio of industrial chemicals.
The acquisition will allow Gulf Oil, part of the diversified
Hinduja Group, to expand its lubricants and chemicals business
Indian companies have been increasingly looking overseas for
acquisitions because red tape, corruption and land acquisition
issues often hurt plans to expand at home.
Founded in 1865, Houghton is a maker of metal working fluids
used for metal processing applications including cutting and
The company has 12 manufacturing facilities in 10 countries and
reported sales of $858 million for the year ended Sept. 30, and
an adjusted EBITDA of $132 million, the Gulf Oil statement
The diversified, family-controlled Hinduja Group's
businesses range from truck and bus maker Ashok Leyland to
It is controlled by Chairman Srichand Hinduja and his
brothers, Prakash P. Hinduja, Gopichand Hinduja and Ashok
Hinduja. The Hinduja brothers have a net worth of $8 billion
and are India's 9th richest, according to
"There will be a lot of synergy. Gulf Oil is into the
lubricants business and this acquisition helps it expand,"
Prakash Hinduja told Dow Jones Newswires on the sidelines of
the World Economic Forum.
Mr. Hinduja didn't say how Gulf Oil will finance the
The company said its operations will be able to leverage
Houghton's extensive base of industrial customers to offer them
a complete end-to-end range of lubricants. In addition,
Gulf Oil noted various synergies that can be achieved in
manufacturing strategic sourcing and distribution.
Dow Jones Newswires