Ciba Specialty Chemicals India (Ciba India) has acquired the 49% holding of Indian Dyestuff Industries (IDI) in the 51:49 joint venture Pigment Specialities India.
Ciba India is an offshoot of the Hindustan Ciba when the latter amalgamated with Sandoz India to form Novartis India. Ciba discontinued the marketing and distribution of pigments from May 1998 after it had entered into the joint venture with IDI to handle the same.
IDIís stake in the Rs.330 m Pigment Specialities comprised 1,960,000 shares, which were bought over Rs.19.60 million by Ciba. The cracks in the alliance were reportedly due to the severe shortfalls Ciba had experienced in supplies from IDI, the company's main supplier.
As per Ciba India's annual report "Öas a result of the suspension of the manufacture of phthalocyanine pigments at IDI, alternate sourcing agreements had to be made from other suppliers. Further, the supplies of Azo pigments and microsols from IDI have also suffered, with some quality problems being experienced for the latter."
The latest development comes even as Ciba had announced the global merger of its textile dyes and pigments division to form the 'Colors division'.
This could be a precursor for the amalgamation of the Pigment Specialities into Ciba India itself. It would however, spell tougher times for IDI. The stock quotes at Rs.7 (52-week range: Rs.16/4).
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