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Reliance signs MoU for JK Corp's polyester business

The Reliance group and JK Corp Limited have signed a memorandum of understanding, according to which JKCL will divest its polyester division, subject to necessary approvals.

Located at Dhenkanal in Orissa, JKCL's polyester fibre and filament yarn plants have a total capacity in excess of 43,000 tonnes per year, and are based on Du Pont technology, similar to the polyester plants of Reliance Industries at Patalganga and Hazira.

This opportunity will offer Reliance enhanced downstream capacity for integration of its PTA and MEG output. It will also underscore its role in restructuring the fragmented polyester capacities in the country.

The move is aimed at higher utilisation rates and enhanced viability. Reliance has already successfully achieved operating synergy through integration of polyester capacities of ICI near Bombay (30,000 tonnes per year) and India Polyfibres in Lucknow, Uttar Pradesh (24,000 tonnes per year).

Considering its location, this capacity in Orissa will further enhance the geographical capability of Reliance to offer improved customer services, particularly in the eastern region.

Reliance is already the fifth largest producer of polyester staple in the world and this development will make a significant addition to its present capacity.

JKCL's polyester division will commence manufacture of polyester fibre and filament yarn for marketing by Reliance, pending receipt of necessary approvals, a Reliance release said today.

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