In the midst of making a couple of billion order bids for global businesses, this acquisition may seem puny but strategic in comparison for the Tata group.
MUMBAI: In the midst of making a couple of billion order bids for global businesses, this acquisition may seem puny but strategic in comparison for the Tata group.
Tata Projects, a closely held company from the Tata group, is acquiring a majority stake in Artson Engineering, a company which is coming out of the BIFR fold.
The investment in Artson will enable Tata Projects to make its presence felt in the hyper segment of engineering, procurement and construction activity within the greenfield power, petroleum, petrochemicals and fertilisers space.
“We are yet to receive the BIFR order. The moment it comes, we’ll inform the stock exchanges,” an Artson official said declining to give more details on the Tata Projects investment. The order is expected in a fortnight, a source said.
“It’s a win-win situation,” the source added. Artson has two veteran project managers at the helm.
N K Jagasia, chairman and managing director and P S Chopde, director, who have promoted Artson.
Between the two, Jagasia and Chopde have over 30 years’ experience in the field. They had resigned from Hindustan Petroleum to promote Artson. One of the conditions in the agreement between Tata Projects and Artson, sources said, is that the two would continue to lead the company.
Further lending credence to the impending strategic-tie-up, Artson and Tata Projects are said to be already working together in Fujairah, UAE, for ENOC, a leading oil company in the Emirates.
The Tatas are themselves in the midst of developing several big-ticket projects in the power and steel sectors. However, they have given their subsidiaries a free hand in scouting for new projects, to make them globally competitive.
Artson has experience in the oil & gas, power, fertilisers and food processing sectors. At the time of the establishment in 1978, the refineries were using Bombay High Crude, which gave a waxy product called Low Sulphur Heavy Stock (LSHS) as residual fuel oil.
LSHS had very high pour point. Artson did pioneering work and developed systems to convert the existing fuel firing systems of industry to make it suitable to use LSHS.
Artson has successfully commissioned, on a turnkey basis, more than hundred such fuel systems in the country. This led to AEL being one of the foremost companies in the country, specialising in petroleum storage and handling systems. This expertise was then expanded and AEL executed overseas projects.
Artson went on developing its capabilities in multi disciplinary construction for the Hydrocarbon Process Industry and is one of the leading design, engineering, procurement and construction companies with a sound manufacturing base.
Tata Projects is also an EPC company with operations in power generation, transmission and distribution, industrial infrastructure, oil, gas and hydrocarbons, and quality services.
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