Morgan Stanley

Morgan Stanley Private Equity Invests Rs. 182 Crore in Biotor Industries Limited, India

Dec 23, 2008

Mumbai —


Morgan Stanley (NYSE:MS) today announced that its Asia private equity group, Morgan Stanley Private Equity Asia, has invested Rs. 182 crores(approximately US$38.5 million) for a significant minority stake in Biotor Industries Limited, the largest integrated manufacturer of castor oil and castor derivatives in the world. This is Morgan Stanley Private Equity's first investment in India and demonstrates the Fund's commitment to making long-term investments in the country.

Biotor is the world's largest fully-integrated manufacturer of castor oils and castor derivatives, with operations across the entire value chain from contract farming of castor seeds to wholly owned retailing operations in Europe and the United States.

Commenting on the deal, Mr. Chin Chou, Managing Director and Head, Morgan Stanley Private Equity Asia, said, "This investment in Biotor represents Morgan Stanley Private Equity Asia's strategy to invest in companies with exceptional management teams and unique competitive advantages. We are also pleased to be making our first investment in India. Morgan Stanley Private Equity Asia raised a US$1.5 billion dedicated fund for Asia last year and we expect to deploy a significant amount of the fund in India over the next two years."

Mr. Rajesh Kapadia, Managing Director for Biotor Industries Limited, commented, "India produces over 75% of the global castor crop and thus has a unique competitive advantage, which has benefited us. As the industry leader, we are investing heavily in R&D, biofuels, new derivatives and developing hybrid seeds in order to take advantage of these opportunities. We are very excited about our partnership with Morgan Stanley Private Equity Asia, as this will provide us access to Morgan Stanley's global franchise and relationships, which we believe will prove invaluable as we aim to increase our international presence."

Mr. Aluri Rao, Managing Director, Morgan Stanley, said, "We are excited about the prospects of the science of producing chemicals from agri-raw materials, known as Chemurgy. Biotor is well positioned to benefit from this trend towards green chemicals. It is a unique company with strong entrepreneurial vision and value systems. Over the past two years Biotor has successfully executed its strategy to move downstream into castor derivatives and direct-marketing of its products."

Castor oil is used in a broad range of industries such as lubricants, biofuels, pharmaceuticals and paints. More recently, global efforts to replace oil-based chemicals with green, renewable, natural, biodegradable and sustainable chemicals has been driving strong demand for castor oil and its derivatives. It is one of the best raw materials for plastics and foams derived from natural sources.

Biotor Industries Limited is the world's largest producer of castor oil and castor derivatives, with the Company's manufacturing plants located in the heart of the Castor producing belt of India at Baroda. Biotor has a fully integrated business model - from contract farming of castor seeds to the manufacture of downstream derivatives. It has an extensive distribution network in the U.S and Europe. Biotor is in the process of executing multiple strategies that are expected to drive topline growth and improve margins. This includes rapid growth of contract farming, developing hybrid seeds, biofuels and expansion of castor derivatives. PricewaterhouseCoopers acted as Biotor's exclusive financial advisor for the transaction.

Morgan Stanley Private Equity Asia is one of the leading private equity investors in Asia having invested in the region for over 15 years. The group has made a number of investments in businesses throughout Asia, including Belle International, Dongxiang Sports and Shanshui Cement in China, Rotem, Jeonju Paper Corporation and Ssangyong Corporation in South Korea, CTCI Corporation in Taiwan, and Asia Capital Reinsurance in Singapore. In addition, it previously invested in Ping An Insurance, China Paradise and Hengan International in China, eAccess in Japan, HTL International in Singapore and Landmark Investment Trust Company in South Korea. In India, Morgan Stanley Private Equity Asia's focus will be on both buyout and growth transactions.

Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services. The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 600 offices in 37 countries. For further information about Morgan Stanley, please visit

Media Contact: Rohit Sethi, +91.998.709.1119

Biotor Media Contact: Shailen Bhargav, +91.981.91.29995