23rd Dec 2021 11:28
(Alliance News) - Hunting PLC on Thursday said it has formed a joint venture with Jindal SAW Ltd to continue to extend its presence in the 'oil country tubular goods' market in India.
The London-headquartered oil field services provider said joint venture, in which Hunting will hold a 49% stake, will continue its partnership with the New Delhi-headquartered manufacturer and supplier of iron and steel pipe products, following their strategic alliance in 2019.
Furthermore, the venture provides a mutual platform for significant growth in India, Hunting said. Its premium connections products will be designated local content, as they will be made in India.
Under the terms of the agreement, the companies will build a dedicated connection facility in the Nashik province near Jindal's steel mill operations with a proposed 130,000 square feet manufacturing footprint.
The partners will contribute an initial USD6 million in cash in proportion to their shareholding, with additional funding to be contributed through loans and cash flow generated from the venture.
The facility is targeted to be operational by end of 2022.
Three threading lines will be commissioned over time with an annual capacity of 50,00 metric tonnes, and Hunting will provide a premium connection threading licence to the joint venture.
The venture is expected to employ around 100 people.
"The Indian oil country tubular goods market provides significant growth potential for Hunting. We are delighted to have entered this joint venture agreement with Jindal, which leverages our excellent working relationship which we have built since 2019," Chief Executive Jim Johnson commented.
Shares were up 0.3% at 160.20 pence each on Thursday morning in London.
By Abby Amoakuh; [email protected]
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