Time Technoplast signs MOU to acquire LPG Composite Cylinders Manufacturer

Time Technoplast Limited (Time Tech) announces the signing of the MOU which allows it to acquire a minimum 70% stake in Kompozit-Praha, Czech Republic,(KP) one of select producers of LPG Composite Cylinders worldwide. The company is engaged in manufacturing high tech Composite Cylinders for LPG at their manufacturing facility at Dysina (near Prague), Czech Republic. Composite Cylinders produced by the company are highly acclaimed for their quality and performance, and conform to the latest international and European standards. Through this acquisition Time Tech shall be able to bring for the first time state of the art' Composite Cylinders in India and will explore business opportunities in other countries in Asia and Middle East. Incidentally KP is well on its way to develop Composite Cylinders for CNG applications which will also be available for commercial use in less than a year.

Kompozit Praha was founded in the year 2000 by a group of businessmen and aerospace scientists, to produce new generation, low cost, high quality composite cylinders for storing liquefied petroleum gas (LPG) . These cylinders will replace traditional steel cylinders. The traditional technology of steel cylinders has been used for more than 100 years and has no further scope for improvement of design , weight or safety of pressure vessels. The stringent demands of customers can be satisfied only by changing to modern technologies & advanced structural materials.
Composite Cylinders have several advantages over steel like light weight (half the weight of steel cylinders), non-corrosive, explosion proof (even in open fire), have long service life & high wall transparency (which allows the users to see how much gas is present). The company has 'state of the art' production facility for producing 5 Lts, 12 Lts, 20 Lts & 24 Lts LPG Cylinders .The production facility is based at Dysina, near Prague in Czech Republic.

The products are duly certified by EU Certifications like TUV (Germany) and Gosstandard (Russia). The Company has its own research & development and has been granted number of patents for the manufacture of composite cylinders for liquefied petroleum gas (LPG) and designing of LPG tank for cars, high pressure cylinders for industrial gases, rescue equipment
The company had a revenue of 15 mn USD in the year ended December, 2008 with the EBITDA of 25% and Net profit of 12%.

Market & Competition
As on date there are more than 1 bn LPG cylinders in use in the world, with 60mn being manufactured every year. Out of these at present approx 1.5 mn composite cylinders are supplied to the world market, whereas the potential market is 10mn cylinders every year. The markets for the Composite Cylinders is developing dynamically.

Transaction:
The total transaction value of acquisition is estimated at USD 5.20 mn including the acquisition of equity stake, repayment of the Promoters debts and further investment to improve product design and productivity in immediate future. The transaction is expected to be closed by 31st Oct 2009 subject to satisfactory due diligence.