INDIA TO INVEST UP TO US$ 500 MILLION IN BRAZIL

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By Monica Magalhaes, from Sao Paulo

Indian corporation Bajaj Hindustan Ltd. (BHL), the largest Indian sugar producer in terms of installed capacity, plans to invest between US$ 250 million and US$ 500 million in Brazil, according to information provided by international news agencies. The money will be invested in the acquisition of more than one sugar-producing plant.

“Fortunately, we should be able to quickly close a deal in Brazil”, says Narayan Raman, head of Institutional Affairs for Bajaj Hindustan. In order to carry out the planned acquisitions, BHL is establishing a subsidiary in Brazil which should “be legally constituted at the end of this week”, says Mr. Raman. The company has already identified the investment bank that will identify and list the potential targets for acquisition.

Internally, BHL hopes to produce 2.1 million tons of sugar in the 2007-08 season, which will come on top of an expected production of 1.6 million tons during the season that begins on October 1^st, 2006. BHL produced more than 800,000 tons of sugar in the 2005-06 season, which closes on September 30^th, 2006.

The increase in production follows plans to almost double processing capacity, to 96,000 tons per day, increasing the capacity of existing plants. “The purpose is to meet domestic demand”, says Mr. Raman. The company’s current capacity is 52,600 tons per day.

The company’s capacity to manufacture industrial alcohol will also grow, rising in 2007-08 to 800,000 liters per day, up from 320,000 liters.

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