Olam acquires Hemarus Industries for almost $74m

The company also plans to invest an additional $6.6 million to expand sugar milling capacity.

Meanwhile Olam said the purchase consideration is towards the acquisition of the following:
• A new (recently commissioned) sugar milling facility of 3,500 TCD capacity, located in the most preferred sugar growing region of India (Kohlapur district of Maharashtra State).
• 20MW co-generation plant capable of handling coal feedstock.
• Additional licences to build a 45 Kilo litre per day (KLPD) ethanol facility and a 3500 TCD Sugar mill in Belgaum district (with 20MW co-generation facility).
• 210 acres of land which would be sufficient for sugar mill capacity augmentation, setting up of an ethanol facility and the bio compost plant.

At steady state, Hemarus Industries Limited is expected to contribute revenues of $90 to 100 million with an expected Return on Equity of 32%.