3i invests US$80 million in Welspun Gujarat

19 Oct 2007

3i, world leading private equity and venture capital company, has invested US$80 million for a 6.6% stake in Welspun Gujarat Stahl Rohren Ltd (“Welspun”) through a purchase of secondary shares in the company.  Welspun Gujarat is the flagship company of the Welspun Group, led by Mr. B.K. Goenka, and is listed on the Indian and Luxembourg Stock Exchanges.

The company is one of the world’s largest manufacturers of line pipes used by the oil & gas sector and is in the midst of executing an ambitious expansion plan including adding new capacity, backward integration into manufacture of plates and coils and establishing an overseas presence with a facility in the US.  The company counts the world’s largest oil & gas companies, including Exxon Mobil, Chevron and Saudi Aramco, as its customers.  Post completion of the Company’s expansion plans, it will have a total capacity of 1.75 million tonnes per annum, up from 1 million tonnes per annum currently.

Mr. Chris Rowlands, 3i Managing Partner, Asia, said, “We are excited to invest in Welspun and have been particularly impressed with the management team and its international outlook.  We believe the company’s international footprint, strong customer relationships, cutting edge technology, backed by a strong demand environment, is a winning proposition.  We look forward to a close relationship as an actively engaged shareholder, leveraging our expertise in the oil & gas sector to further the company’s prospects.”

The company has the distinction of having supplied pipes for the world’s deepest gas pipeline in the Gulf of Mexico and was ranked 39th by Standard and Poor amongst India’s top 100 companies.  Business India, a leading Indian business magazine, has ranked Welspun as India’s fastest growing company.

Notes to editors

About Welspun Gujarat Stahl Rohren Ltd.
Welspun Gujarat Stahl Rohren Ltd. Is the Fastest Growing Company in India (Source: Business Today) and is part of the $1.5 billion Welspun Group. The company started its activities in 1995 and since then has supplied pipes for some of the most prestigious projects including the World’s deepest pipeline project in the Gulf of Mexico, USA. The manufacturing facilities incorporate the hybrid JCO technology from Mannesmann Demag of Germany (SMS Meer). The company, since its inception has manufactured over 6000 kms of line pipes for all critical applications. The company has been recognized X80 grade and 56” outer diameter line pipes in the country. W.G.S.R.L is equipped to meet the growing demand and is in a position to meet the stringent requirements and standards of high grade line pipes.

About 3i

3i is a world leader in private equity and venture capital.  We focus on Buyouts, Growth Capital, Venture Capital, Infrastructure and Quoted Private Equity and invest across Europe, the United States and Asia.  Our competitive advantage comes from our international network and the strength and breadth of our business relationships.  These underpin the value that we deliver to our portfolio and to our shareholders.

3i Growth Capital is the world’s largest growth capital fund investing over $2bn every year in businesses across Europe, Asia and the US.  We provide financial and strategic support to established businesses with the potential for outstanding value growth.  We invest between $20m - $200m to help businesses achieve their growth ambitions, restructure shareholdings, release equity or change the balance of equity to debt.  Once we have invested, we are committed to working in partnership with majority shareholders. 

For further information please contact:

Kathryn van der Kroft
email. kathryn.vanderkroft@3i.com
tel.  +44 207 975 3021