GP Global (formerly Gulf Petrochem Group) announced that it has completed its acquisition of MAG Lube in the United Arab Emirates.
MAG Lube is a manufacturer of lubricants in the Middle East, distributing its full range of lubricants in more than 40 countries across the Middle East, Africa and Asia.
GP Global has acquired a majority stake of MAG Lube, a company valued at close to $75mn, in a global lubricants market said to reach $166.23bn by 2025, according to Grand View Research, expanding at a 3.8% CAGR during the forecast period.
The current CEO, Mahmoud Al Theraawi, will remain in his position and continue to lead the business in the UAE with the GP Global Lubricant team in the country integrating into the overall MAG Lube structure.
Established in 2013, MAG Lube witnessed 100% growth year-on-year, with 30,000sqm state-of-the art blending facility situated in National Industrial Park, Jebel Ali. Its factory has the latest fully automated blending system technologies designed in France and has a fully equipped, ultra-modern laboratory focusing on research and development. MAG Lubes currently employs over 100 employees across the Middle East and Africa, who will continue to service customers with the same level of care following the acquisition.
As a result of the acquisition, GP Global’s lubricant business is expected to achieve regional sales of over 60,000 kilo litre (KL) in 2018, up from 12,000KL prior to the acquisition. The renewed output will move GP Global into one of the top lubricant manufacturers in the UAE and get closer to GP Global’s strategic vision of producing 250,000KL of lubricants globally by 2022, through organic and in-organic growth.
Speaking about the acquisition, Sudhir Goyel, managing director at GP Global, said: “Our lubricants business has witnessed steady growth over recent years both organically and in-organically. The acquisition of MAG Lube, a regional leader in lubricants, compliments our growth plans for the group and brings us a step closer to our group’s strategic vision of producing 250,000KL of lubricants by 2022 through organic and in-organic growth.”
“Through our majority stake in MAG Lube, we will be able to realise the kind of scale that would allow us to enjoy the benefits of the entire value chain in line with our presence in other components of the chain. The group’s combined output will now stand at 140,000KL per annum, which includes GP Global’s operations in India.”
GP Global will hope to witness the same integration and growth achieved through its acquisition of GP Petroleums, an Indian listed lubricant company, owners of the IPOL brand. The acquisition will further bolster GP Global’s offering across its business units – refining, storage terminals, trading and bunkering, bitumen, lubricants and grease manufacturing, and shipping and logistics.