Fairfax buys India's Privi Organics for $55m

The transaction, which is expected to close in the third quarter of 2016 and is subject to regulatory approval, will see Fairfax acquire a 51% stake in the business. Following the purchase, Fairfax plans to help enable a merger between Privi and Adi Finechem, an Indian chemical maker in which Fairfax bought a 45% stake last year for about INR1.3 billion.

After the merger Fairfax will hold a 49% stake in the combined company, which will be named Fairchem Speciality (Fairchem). Fairchem will focus on converting renewable waste feedstocks into value-added specialty chemicals; Adi Finechem and Privi will operate as separate business units within Fairchem.

Privi supplies aroma chemicals to a wide range of global fragrance and consumer goods manufacturers. The company has a portfolio of more than 50 products and a manufacturing capacity of more than 15,000 tons per year at its two integrated manufacturing facilities.

"We are delighted to partner with Fairfax India as a committed long term investor and Adi Finechem, a leader in the field of specialty chemicals for the adhesive and nutraceutical industries," said Privi Managing Director Mahesh Babani in a statement. "We see a strong alignment of values and interests of all stakeholders in this partnership."

Privi marks Fairfax's third India chemicals investment; earlier this year the firm paid $300 million for a 30% stake in PVC construction materials producer Sanmar Chemicals. Fairfax raised $1 billion for the India investment unit last year through a combined IPO and product placement.

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• Topics
• South Asia
• Industrials
• Buyouts
• India
• Chemicals