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February 26, 2019

Indorama completes Brazil fibres acquisition

By Beth Wright

Thai chemicals, fibres and woollen yarns conglomerate Indorama Ventures Public Co. Ltd. (IVL) has completed its acquisition of M&G Fibras Brasil for an undisclosed sum.

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The deal, which was first announced in November, marks Indorama’s debut into the fibre business in Brazil and has been hailed by the firm as a strategic step forward, providing a “unique opportunity” to add capacity in fibres and establish its presence in South America’s largest economy.

Located in Cabo de Santo Agostinho, Brazil, M&G Fibras Brasil manufactures and supplies polyester staple fibre, with an annual capacity of 75,000 tonnes. The facility will be in close proximity to Indorama’s PET plant in Brazil.

Indorama says the acquisition will significantly boost its presence in the country, where domestic demand is expected to grow in response to a recent recovery in consumption. In addition, it says the firm is well-positioned to expand further into nonwoven applications which it says are growing strongly in Brazil, supported by the presence of global brands. The acquisition will also strengthen the company’s ‘Home and Lifestyle’ portfolio.

Meanwhile, Indorama anticipates lowering its fixed costs by creating synergies and operating efficiencies, driven by supply chain optimisation with the delivery of PTA from a nearby location, and consolidation of its commercial offices by joining with its PET site. Further synergies will be realised through logistic advantages due to established free trade agreements with other Latin American countries, it adds.

“We are putting the puzzle pieces in place, and this acquisition is a perfect piece in the fibres market. Not only does it help to strengthen our industry-leading positioning, but it also enhances our ability to serve the growing needs of customers with high-quality fibres,” says Aloke Lohia, group CEO of Indorama Ventures. “This acquisition will help develop our strategy in Brazil and ensure continued employment and development of the national economy as well as strengthen the fibres industry.

“We are excited to welcome M&G Fibers to the IVL family, and look forward to leveraging our integration capabilities to ensure that we generate the greatest value for our customers and shareholders.”

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What’s missing from your IPO industry assessment?

IPO activity all but stopped in 2020, as the investment community grew wary of the effects of COVID-19 on economies. No matter how deserving a business was of flotation, momentum was halted by concerns of when a ‘new normal’ of working patterns and trade would set in. Recently, sentiment has changed. Flotations picked up again during the second half of 2021, and now in 2022 the mood is decidedly optimistic. Business leaders have their eyes on fast rebounding economies, buoyant market indices and the opportunity once again to take their businesses public. As a result, global IPOs are expected to hit back this year. With GlobalData’s new whitepaper, ‘IPOs in Consumer and Retail: 5 must-include elements for your prospectus industry report’, you can explore exactly what is needed in the essential literature. GlobalData’s focus lies in the critical areas to get right:
  • Macroeconomic and demographic environment
  • Consumer context
  • Industry environment
  • Competitive environment
  • Route to market
Interested to learn more about what to include in your IPO Industry Assessment report? Download our free whitepaper.
by GlobalData
Enter your details here to receive your free Report.

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