MAN Industries (India) Limited, one of India’s
leading manufacturers of large-diameter carbon steel line pipes, has announced
that its wholly owned subsidiary, MAN International Steel Industries Company
(MISIC) in Saudi Arabia, has acquired 100 per cent National Pipe Company
Limited (NPC), one of the Kingdom of Saudi Arabia’s most established API
large-diameter carbon steel line pipe manufacturers, with its plant located in
Dhahran and office in Al Khobar, Eastern Province, Kingdom of Saudi Arabia.
The acquisition is for a total cash outflow of USD
102-million (~INR 1,000-crores).
NPC carries a strong balance sheet with cash and
liquid assets of USD 83-million comprising cash and bank balances of USD 38-million,
trade receivables of USD 13-million and finished goods inventory of USD 32-million,
and a net worth of USD 158.63-million, reflecting the inherent asset strength of
this acquisition.
NPC is a profit-making, debt-free, API-certified
large-diameter SAW pipe manufacturer with an established order book comprising
active orders from Saudi Aramco and other marquee clients, full regulatory
approvals in place, and 100 per cent of its assets acquired making this a fully
operational, revenue-generating asset from Day 1. The Company holds API 5L and
API 2B certifications, is ISO 9001:2015 certified, and has been a Saudi Aramco
Approved Vendor for over two decades.
“In a single transaction, we have acquired 430,000
MTPA of API-certified capacity, a blue-chip customer base anchored by a 20-year
Aramco relationship, and a debt-free balance sheet at a valuation that is a
fraction of where comparable assets trade. Based on NPC's current earnings
profile and order book, we expect the investment to yield a payback in
approximately 1.5 years, a return profile that, alongside the strategic fit,
reflects the disciplined approach we have taken to capital deployment,” said Nikhil
Mansukhani, Managing Director, MAN Industries (India) Limited.
National Pipe Company Limited (NPC) is established in Dhahran, Al Khobar, Eastern Province, Kingdom of Saudi Arabia. NPC operates two world-class pipe mills across a total plant area of ~100 acres freehold land with a combined installed capacity of 430,000 MTPA. NPC’s previous shareholders comprised NPC Management Company, a joint venture between Nippon Steel Corporation, Japan, and Sumitomo Corporation, Japan and other Saudi shareholders.
“Based on NPC's current earnings profile and order
book, we expect the investment to yield a payback in approximately 1.5 years, a
return profile that, alongside the strategic fit, reflects the disciplined
approach we have taken to capital deployment.”
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Nikhil Mansukhani,
Managing Director,
MAN Industries (India) Limited.