Tega Industries , a leading manufacturer of specialized 'critical to operate' products for the mining industry, has announced significant strategic moves that are set to reshape its market position and global footprint.

Fundraising Exploration

The company's Board of Directors has scheduled a meeting for September 13 to evaluate proposals for raising funds through various means. These include the issuance of equity shares, debt securities, and other eligible securities through permissible modes such as private placement, preferential allotment, or qualified institutions placement.

Strategic Acquisition of Molycop

In a major development, Tega Industries, in consortium with funds managed by affiliates of Apollo Global Management, has entered into a term sheet to acquire Molycop, a global leader in grinding media for the mining industry. The acquisition is valued at an enterprise value of approximately USD 1.50 billion.

Key Highlights of the Acquisition:

• Complementary Strengths: The acquisition will combine Tega's expertise in polymer mill lining with Molycop's leadership in grinding media, creating a comprehensive solution provider for the comminution circuit in mining operations.

• Global Footprint: The combined entity will have a presence in over 40 countries, with 26 manufacturing sites strategically located near customer operations.

• Financial Impact: Post-acquisition, the consolidated entity is expected to generate revenues of approximately USD 1.73 billion (INR 15,207.00 crore) and EBITDA of USD 217.00 million (INR 1,906.00 crore), based on the latest available annual audited financial statements.

• Ownership Structure: Tega Industries will be the controlling shareholder, owning approximately 77% of Molycop, with Apollo Funds holding the remaining 23%.

Synergies and Growth Opportunities

The acquisition is expected to unlock significant synergies:

1. Complementary Product Portfolio: Tega's mill liners and wear products will complement Molycop's grinding media and flotation chemicals.

2. Enhanced Global Presence: The combined entity will have a stronger presence in key mining regions worldwide.

3. Operational Efficiencies: Potential for cost synergies in manufacturing, R&D, and SG&A.

4. Integrated Solutions: Ability to offer complete mill optimization solutions, potentially increasing market share and customer value.

Financing the Acquisition

Tega Industries plans to fund the acquisition through a mix of equity and debt. The company is considering raising approximately USD 248.00 million (INR 2,179.00 crore) in equity, with additional corporate debt of about USD 113.00 million.

Market Impact and Future Outlook

This strategic move positions Tega Industries as a comprehensive solutions provider in the mining consumables sector. The expanded product range and global reach are expected to strengthen the company's competitive position and drive long-term growth.

Mehul Mohanka, Managing Director and Group CEO of Tega Industries, commented, "This strategic acquisition, in partnership with Apollo Funds, will accelerate innovation, greatly expand our market reach, and create significant value for our customers."

The transaction is expected to close by December 31, 2025, subject to customary closing conditions and regulatory approvals.

Tega Industries' shares will be closely watched by investors as the company embarks on this transformative journey, potentially reshaping the landscape of the mining consumables industry.

Tega Industries Limited has announced plans to acquire Molycop, a leading global supplier of grinding media to the mining industry, in a deal valued at $1.5 billion. This strategic move is set to transform Tega into one of the world's leading providers of critical consumables for the mining, mineral processing, and material handling industries.

Transaction Details

The acquisition will be executed through a consortium led by Tega Industries (77%) and Apollo Management Singapore Pte. Ltd. (23%). The deal involves an upfront consideration based on an enterprise value of $1.48 billion, with a potential contingent payment of approximately $120 million within 45 months of the acquisition's completion.

Strategic Rationale

Manak Rai, CEO of Tega Industries, commented on the acquisition: "This transformative deal will significantly expand our product portfolio and global footprint. By combining Tega's expertise in polymer mill linings and wear products with Molycop's leadership in grinding media, we'll be able to offer a comprehensive suite of solutions across the entire comminution circuit."

Key benefits of the acquisition include:

• Complementary product offerings
• Enhanced global presence
• Potential for significant revenue and cost synergies
• Expanded manufacturing footprint and R&D capabilities

Creating a Global Leader

The combined entity is expected to generate annual revenues of approximately $1.7 billion with an EBITDA of $217 million. This positions Tega Industries as a major player in the mining consumables market, with a presence in over 70 countries and access to a broader customer base.

Molycop Overview

Molycop, founded in 1917, is a leading supplier of grinding media with a global manufacturing and sales network. The company operates 13 grinding ball manufacturing facilities and has joint ventures in strategic locations worldwide. Molycop's products are critical for mineral extraction and processing, particularly in copper and gold mining operations.

Financial Highlights

For the fiscal year ending June 2025, Molycop reported:

Funding and Closing

Tega Industries plans to fund the acquisition through a mix of equity (including a potential QIP and preferential allotment to promoters) and debt. The transaction is expected to close by December 31, 2025, subject to customary closing conditions and regulatory approvals.

Market Impact

This acquisition is poised to reshape the mining consumables industry, creating a comprehensive solution provider for the comminution circuit. The combined entity will be well-positioned to address the growing demand for efficient mineral processing solutions, driven by declining ore grades and the need for increased productivity in the mining sector.

Conclusion

The acquisition of Molycop represents a significant milestone for Tega Industries, propelling it into a leadership position in the global mining consumables market. As the mining industry faces challenges such as declining productivity and ore yield, the combined expertise of Tega and Molycop is expected to deliver innovative solutions to meet these evolving needs.

Investors and industry observers will be watching closely as this transaction unfolds, potentially setting the stage for further consolidation in the mining supply sector.