The joint venture will be the first manufacturer of butyl rubber in India and the fourth largest supplier of butyl rubber in the world.
The JV will meet demand for synthetic rubber from the Indian automotive industry, whose current requirement for more than 75,000 tonnes per year is satisfied by imports.
Reliance Industries will own 74.9% of the JV with SIBUR 25.1%. The JV will invest US$450 million to construct the production facility, which is expected to be commissioned in 2015.
RIL and SIBUR also signed a technology licence agreement facilitating use of SIBUR's butyl rubber production technology at the new facility. SIBUR will develop basic engineering design for the facility and also train the JV’s personnel at its production site in Togliatti, Russia.
Reliance Industries Limited (RIL) is India’s largest private sector company with a turnover of INR 2,58,651 crore (US$ 58.0 billion), cash profit of INR 34,530 crore (US$ 7.7 billion), net profit of INR 20,286 crore (US$ 4.5 billion) and net worth of INR 1,51,540 crore (US$ 34.0 billion) as of March 31, 2011.
RIL is the first private sector company from India to feature in the Fortune Global 500 list of World's Largest Corporations and ranks 119th amongst the world's Top 200 companies in terms of profits. RIL ranks 68th in the Financial Times FT Global 500 list of the world's largest companies. RIL is ranked amongst the 50 Most Innovative Companies - 2010 in the World in a survey conducted by the US financial publication - Business Week in collaboration with the Boston Consulting Group (BCG). In 2010, BCG also ranked RIL as the second highest Sustainable Value Creators for creating the most shareholder value over the decade in the world.
SIBUR (www.sibur.com) is the largest petrochemical company in Russia and Eastern Europe, one of the fastest growing petrochemical companies in the world and in the top three by EBITDA margin in the petrochemical industry globally. The Company is one of the top two European synthetic rubbers producers.
SIBUR operates across the entire petrochemical process chain from gas processing, production of monomers, plastics and synthetic rubbers to the processing of plastics. SIBUR is a vertically integrated company with its gas processing facilities providing feedstock for its petrochemical production. SIBUR’s export sales are around 40-45%. The company has trade houses in Europe and China. Overall, the company produces more than 2,000 different brands of products and invested more than $2 billion in further developments in 2011.