2 July 1998: India“s FGP Ltd., an RPG group affiliate, has reportedly decided to sell its fibre glass reinforcement business to Saint Gobain, the French multinational which has been aggressively movi…
2 July 1998: India“s FGP Ltd., an RPG group affiliate, has reportedly decided to sell its fibre glass reinforcement business to Saint Gobain, the French multinational which has been aggressively moving into India, according to a recent press report. In a recent announcement, FGP said it has signed a Memorandum of Understanding (MoU) with Vetrotex International, a 100% subsidiary of Saint- Gobain. “A final agreement will be subject to a due diligence by Vetrotex and the necessary approvals of the Government of India, finanacial institutions and the shareholders of FGP,” FGP president K.V. Gopalakrishnan stated in a signed statement. “The board of FGP felt that it would be in the company“s best interests if a leading global player having the necessary technology and access to world markets could be brought in to takeover FGP“s fibre glass reinforcements business,” said the statement. The decision to sell has reportedly been prompted by the changed conditions in the post-liberalisation era. A number of global players are said to have been interested in setting up projects in India, with a few having already announced plans to set up manufacturing facilities. The fibre glass industry worldwide is extremely capital and technology intensive, said the report. The FGP board decided, in this context, to sell the business to a global major which has the necessary expertise and access to world markets, the report added.