HLL Announces Joint Venture With ICI India And Quest International For Fragrances And Flavours

Under the proposed joint venture arrangement, ICI India and Quest International BV will together hold 51% and the balance 49% will be held by HLL. The joint venture combines ICI India’s long standing knowledge of India, HLL’s detailed understanding of Indian consumers’ preferences coupled with Quest International’s consumer understanding, technological and creative expertise. The JV is expected to become operational in the middle of the year, and will buy and own HLL’s current operations, covering its activities and associated facilities for this business. The value for the 51% shareholding in the JV is placed approximately at Rs. 155 crores which includes a premium for management control.

The joint venture would however, exclude the aroma chemicals business of HLL and the erstwhile Industrial Perfumes Limited which would be carried on as a division of HLL.

HLL is extremely pleased with the formation of the joint venture since it was HLL’s clear intent to tie up with a technology partner to secure longer term future viability of this business, post global divestment of Unilever’s specialty chemicals businesses in 1997. The proposed tie-up with ICI India and Quest International BV will provide cultural and operational fit for the Quest division of HLL which until 1997 operated as the Indian arm of Quest International’s business.

The proposed transaction, in as much as it relates to transfer of the flavours and fragrances and food ingredients business to the proposed joint venture, is subject to the shareholders’ approval which is proposed to be secured at the ensuing Annual General Meeting on June 1, 2001.