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Swiss chemicals major Clariant AG has formed a 51:49 joint venture with Bhartia family-promoted India Glycols to manufacture and market renewable ethylene oxide (EO) derivative products.

EO derivatives are a class of chemicals that have multiple industrial and consumer applications ranging from freezing agents and coolants for automobile engines to cosmetics.

Clariant, spun off from pharmaceutical giant Sandoz in 1995, will be the dominant shareholder but the JV will be helmed by India Glycols CMD Uma Shankar Bhartia.

As per the terms of the agreement, India Glycols will contribute its renewable Bio-EO derivative business to the JV, which includes a multipurpose production facility including an alkoxylation plant located in Kashipur, Uttarakhand.

Clariant will contribute its local industrial and consumer specialties business in India, Sri Lanka, Bangladesh and Nepal, held by Clariant India Ltd, as well as a net cash payment to obtain a 51% stake.

“This opportunity to partner with India Glycols is an important step in Clariant’s journey to strengthen our core portfolio, while adding value with sustainability,” said Conrad Keijzer, chief executive of Clariant. The partnership will broaden its global offering to customers and make it a leader in ‘green’ ethylene oxide derivatives, Clariant said.

“The partnership is in line with India Glycols’ strategy to promote value-added products through sustainable green chemistry in the domestic market while expanding footprints in global markets,” Bhartia, the CMD of India Glycols, said. EY was the exclusive financial advisor to India Glycols for the transaction.

India Glycols reported revenue of Rs 5,963 crore for the financial year ended March 31, 2020. Its earnings before interest, tax, depreciation and amortization (Ebitda) were Rs 402 crore.

Clariant group reported over $3.8 billion in revenue for the year 2020. Its Ebitda margins were more than 15%.