IFGL Refractories buys stake in German firm

Kolkata: IFGL Refractories announced the acquisition of 96.16 per cent of the share capital of Hofmann Ceramic GmbH of Germany and 100 per cent partnership interest in Hofmann OHG, Germany.

IFGL has also acquired 92 per cent of the shareholding of Hofmann Ceramics of Czech Republic and 100 per cent shareholding of Hofmann Ceramics Ltd, UK Hofmann Ceramics Llc, of the US.

The acquisition has been made through a SPV, IFGL GmbH, for a consideration of €7 million. The acquisition was funded by a loan of €5.3 million obtained from HSBC Bank Plc, UK, according to Mr Pradeep Bajoria, Director & Chief Executive of IFGL Refractories Ltd.

Mr Bajoria said that Hofmann entities were primarily engaged in the manufacture of ceramic filters and refractories for the foundry industry. Its operating facilities were located at Breitscheid-Erdbach in Germany and in the city of Bela in the Czech Republic. The combined turnover of Hofmann entities is €13.67 million.

The acquisition of Hofmann entities will enable IFGL and its subsidiaries in Brazil, China, UK and the US – which presently manufacture refractories for iron and steel industries – to diversify and meet the foundry industry’s requirements of ceramic filters, refectories and consumables.

At a later date, IFGL plans to manufacture ceramic filters in India for the local market and also for exports. Plans to manufacture technical ceramics for the wire and cable industry are also in the anvil.

Mr Bajoria said IFGL was setting up its second continuous casting refractory manufacturing facility at the Kandla SEZ in Gujarat at an investment of Rs 50 crore. It will have a capacity to manufacture 500,000 refractory units annually.

The company’s existing manufacturing facility at Rourkela has a capacity to manufacture 800,000 refractory units per annum.

In 2007-08, IFGL notched a consolidated turnover of Rs 378 crore and a profit after tax of Rs 28.5 crore, Mr Bajoria said.