Saudi Sell Brazilian Company to Colombian Group

Pipes by Amitech in Brazil Saudi company Amiantit has decided to sell 70% of its operations in subsidiary Amitech in Brazil, Argentina and Mexico to Colombian group Inversiones Mundial. The deal was closed this week by Amitech Brazil, which produces large diameter pipes and connections. The Saudi company is going to keep a 30% share.

In the first half of this year, Amiantit announced it was negotiating the sale of part of its assets in some countries. According to the organization, the value of the deal with Inversiones Mundial is 33.75 million Saudi riyals, or US$ 9 million.

Apart from that, the Arab company is going to receive 11 million riyals (US$ 2.9 million) relative to loans made in previous years. The Saudi group took control of the Brazilian company, which was then called G-Tec, in 2002.

The president of Amitech Brazil, Roberto Roselli, said that Amiantit has decided to prioritize the markets in Europe, Africa, Middle East and Asia. Amiantit was established in Saudi Arabia in 1968 and recently underwent a fast period of international growth, through acquisitions of foreign companies, now owning 34 factories, own or in joint ventures, in 18 countries.

At the same time, Inversiones Mundial intends to increase its presence in Latin America. The company currently operates in the areas of paints, chemical products, pipes, retail and packages and has units in Colombia, Venezuela, Ecuador, Mexico and Chile.

The organization owns technology Flowtite, for production of polyester pipes strengthened with fiberglass, the same used by Amiantit and Amitech, and will now also have subsidiaries in Brazil and Argentina. The company seeks leadership in the reinforced pipe market in the region.

According to Roselli, Inversiones Mundial has imposed as a condition for completion of the business the control of Amitech in Brazil, Argentina and Mexico. The continuation of Amiantit as a partner in the company, however, guarantees the continuation of technology transfer. The Saudi group owns six technological development companies.

Roselli guaranteed that the transaction is not going to interfere in the Amitech investment plans in Brazil, neither in the agreements signed with other clients. New equipment is being installed in the factory in the interior of the state of São Paulo, expanding the production capacity from the current 120 kilometers of pipe per year to 300 kilometers in early 2008.

The company recently signed a contract with the government of Ceará (NE Brazil) to supply 19 kilometers of pipes for the Integration Canal, the largest water distribution system ever built in the state.

Roselli stated that the Amiantit sale was not motivated by the performance of the business. "The business has been performing well, with good perspectives for the future," he said. According to the executive, Amitech Brazil sales grew 50% from 2004 to 2005 and 80% from 2005 to 2006. He adds that revenues are currently around US$ 15 million.

According to information supplied by Amitech, the factories in Brazil, Argentina and Mexico had joint revenues of US$ 41 million last year and employed 250 people, being 85 in Brazil.

Inversiones Mundial, established in 1921, in turn, has annual revenues of US$ 700 million. Amiantit had revenues of US$ 709 million last year.

Contact

Amitech
Tel: (+55 19) 3576-6000
Site:
www.amitech.com.br

Anba – www.anba.com.br

Tags:

Ads

You May Also Like

Brazil, the Original Leader of the Americas ”“ Part I

In November 1807, when Napoleon’s army invaded Portugal, the day before the French forces ...

Brazil and India Cold to G8’s One-Month Deadline for WTO Negotiations

Leaders of the Group of Eight major industrial countries meeting in St. Petersburg, Russia ...

Minas Gerais Big Winner in Routes of Brazil Contest

Minas Gerais, a state in southeastern Brazil, won four of the eight Routes of ...

Brazil Adopts Tougher Environmental Rules

New rules for the economic utilization of environmental preservation areas in Brazil should be ...

Import of Narghiles in Brazil Grows Almost Six Fold

The diffusion of the use of the narghile in Brazil is boosting imports of ...

Foot and Mouth Disease Don’t Alter Brazil’s US$ 117 Billion Overall Exports

The outbreak of hoof and mouth disease will cause Brazilian beef exports to drop ...

Torture and Impunity Are Still the Norm Throughout Brazil

Brazilians, especially Indians and other socially excluded segments of the population, continue to suffer ...

Due to Prejudice Majority of Jobless in Brazil Are Women

Women form the majority of the unemployed in Brazil’s six metropolitan areas – Rio ...

To Beat a Woman Is Just Natural in Brazil

Nineteen percent of Brazilian women, that is one in every five, have been victims ...

Brazil’s Debt Falls US$ 2 Bi, Still US$ 329.7 Bi

Brazil’s net government debt fell in September for the third straight month, to a ...