Manali Petrochemicals In Talks For Global Alliances

Chennai, September 25: | Updated: Sep 26 2002, 05:30am hrs
Manali Petrochemicals Ltd (MPL) is in talks with a slew of global majors to forge a business alliance for the supply of key intermediate products on a long-term basis. The move is part of the companys strategy to move away from commodity products to specialty products. MPL is promoted by Southern Petrochemicals and Industrial Corporation (SPIC) and Tamil Nadu Industrial Development Corporation (TIDCO)

Company chairman AC Muthiah told reporters at the sidelines of its 16th annual general meeting held here that MPL is in the very advanced stages of discussions with a number of foreign players to enter into a long-term business agreement that would help the company shift its focus from commodity products to specialty products.

I cannot divulge the names of the companies as it will be improper to reveal it now. However, the deal is expected to be finalised very soon, Mr Muthiah, who is also the chairman of SPIC said. The alliance will help the company stabilise the current business and effectively counter the competition and also help to retain the customers on a long-term basis.

Mr Muthiah said the alliance would be only a business partnership and would not involve any equity arrangement. It will be purely a business arrangement, the company chairman said.

The partnership is to ensure a long-term supply contract for sourcing isocyanates, one of the key intermediary to produce propelyne. Once the agreement is concluded the company would slowly move away from the highly volatile commodity products to specialty products for which there is a huge demand and has better realisations.

Commodity products of flexible polyol and propelyne glycol have to bear the brunt of the low priced dumping by multinational producers. The company had to take up the matter with directorate of anti-dumping for imposing anti-dumping duty. The final findings of the directorate has been released recently and dumping margins have been specified for the four major exporting countries/regions. Notification regarding the final duties to be imposed is expected shortly, he said adding this is likely to improve the prices and thereby the performance of the company.

The Rs 200-crore company manufactures propylene oxide, propelene glycol, polyols, PGMME, di-propylene glycol and tri-propylene glycol.