The move is in line with the paint major's stated strategy of becoming one of the top 10 decorative paint company in the world by 2003, its vice chairman and managing director Ashwin Dani said.

The acquistion was carried out through the company's subsidiary Asian Paints International, which is based in Mauritius. The existing promoters of Delmege Forsyth, which controls over 12 per cent of the Sri Lankan paint market, will hold the remaining 24 per cent stake.

Dani said the acquisition will give the decoratives paints business greater economy of scale. "We first want to consolidate our position now in Sri Lanka, and then see how it can be expanded," he added.

He said there was no plan as of now to utilise the facility in the island country to market its products in South India.

The Financial Express had on July 29 reported that Asian Paints is planning major acquisitions in the emerging markets as part of its "Vision 2003" plan. After announcing its global gameplan, the company has been agressively pursuing overseas acquisition opportunites. It already has eight overseas subsidiaries with operations stretching from Fiji to the Middle East.

The acquistion in Sr Lanka would further strengthen the company's presence in the subcontinent apart from benefiting from the strong brands that Dalmege Forsyth possess, the company said in a statement.

With the demand for paint product is increasing in emerging markets, the company has set up two subsidaries in Oman and Mauritius which will become operational by the year end.

The company's new plant in Oman will cater to the demand of the entire Middle East. Plans are afoot to styart more subsidiaries in the Middle East This is how the company built up its global operations by starting off with a subsidiary in Fiji. For starters, the Fiji arm, catered to the requirements of the entire South-Pacific region for where the base was expanded.

Insight
Poised for success

Asian Paints' acquisition of Sri Lankan paints company Delmege Forsyth & Co fits in with its vision to be amongst the top ten decoratives paints companies in the world by the year 2003. Its Rs 11.50 crore Nepal subsidiary has been growing at a faster pace than itself and there is every likelihood of a similar success in Sri Lanka. More so, since Delmege Forsyth & Co is an established player in the Sri Lankan market and Asian Paints would be in a position to build on its strong foundations.

Sarad Saraf