INDIA BUSINESS WORLD - DECEMBER 2005
THE MONTH THAT WAS

GHCL SNAPS UP DAN RIVER FOR $100 MILLION

GHCL has struck an initial agreement to buy Dan River, a leading Viriginabased home fashion and fabric maker, for about $100 million, top industry sources said. The Sanjay Dalmia-promoted company is also acquiring a majority stake in SC Bega Upsom, a leading soda ash maker in Romania, for $20 million in an all-cash deal. An announcement is expected later this week. GHCL, which has textiles and soda ash business in Gujarat, had signed a prelimiary agreement with Dan River some weeks ago. The US company, which was established in the town of Danville, Virigina 123 years ago, emerged from Chapter 11 in February this year. It has revenue of about $300m, industry sources said.

It is a well-known maker of sheets, pillow cases, draperies and woven cotton and cotton blended fabrics for apparel manufacturers. It employs about 3,500 people and has operations in Danville, Brookneal Viriginia, Harris and Morven North Carolina and in Canada.

Industry sources said GHCL is now looking to raise funds for completing the process. The acquisition will give GHCL ready access to established customers.
GHCL's investment in the Romanian firm will be made through an international subisidary. Initially, GHCL would pick up around 65%. The company is also likely to make an open offer as per the Romanian regulations, sources added.Bega Upsom, a Bega group company, is one of the leading dense soda ash manufacturer with a capacity of over 250,000 tonnes per annum (TPA). Dense soda ash finds usage in glass manufacturing and other construction activities. In addition, the company manufactures sodium bicarbonate and has a capacity of 15,000 TPA and 230,000 TPA respectively. The company employs about 857 people. Post acquisition, the soda ash capacity of GHCL will go up to about 900,000 tonne.