Tata Chemicals not to pick up equity in Gabon urea project

Tata Chemicals  will not participate in an ammonia-urea project being set by a JV between Olam International and the Gabon government in the African country.

The Indian company in 2011 had announced its plans to participate in the urea project, in which Olam International holds 80 percent stake and the rest by the Gabon government. Tata Chemicals (TCL), in a filing to the BSE, said that the decision was made due to a change in TCL’s investment focus away from overseas fertiliser manufacturing and Olam’s intention to move to a minority and non-consolidated position in the project.

“Olam International and Tata Chemicals have today signed a termination agreement and wish to announce that TCL will not proceed with its proposed 25.1 percent equity participation in the greenfield ammonia-urea fertiliser manufacturing project in the Republic of Gabon, Africa,” the filing said.

TCL, however, said that it will maintain its relationship with the project by providing any technical support that may be requested by with Olam International (Olam) or other equity partners. “As announced previously, Olam is continuing its discussions with other industry participants who have expressed their desire to partner with us in the project,” Olam’s Executive Director of Finance and Business Development, A Shekhar. “This is in line with our intention to bring down our final equity stake to below 50 percent,” he added.

Source: moneycontrol.com