Carborundum Universal Ltd (CUMI) enters into a joint venture with China Engineering and Exploration Bureau (CEEB)
Picks up 49 per cent stake in Jingri Industrial Diamond Company, Yanjiao in China

Chennai, June 14, 2006: Carborundum Universal Ltd (CUMI), a leader in the abrasives and ceramics market, part of the Rs.7300 crore ($ 1.60 billion) Murugappa Group, has signed a joint venture agreement with Jingri and CEEB - the promoters of Jingri to acquire a stake of 49 per cent in the parent company (JINGRI) for an investment of USD $ 4.9 million. The Stake will be acquired by JINGRI issuing fresh shares to CUMI in the capital of Jingri. The Joint venture will be re-christened as JINGRI CUMI Super Hard Metal Company Ltd.

The funds raised will be used to set-up a state-of-the-art 2000 tons Bonded Abrasive plant in the Yanjiao Province at a new site, land for which has been allotted by the Province. This facility will eventually house all the Jingri and its JV operations. CUMI will supply the technology for the ABRASIVE Plant besides it will also be involved in the management of the business as a JV Partner.

With this JV, CUMI will move a step further in its twin stated objectives of, (1) Offering the Full Range of Abrasives and (2) Creating a strong manufacturing back-end in India and China to serve its Global Customers. The parallel activity of setting up a global delivery network by a combination of PAPs (Product Availability Points), distribution agreements, alliances and joint ventures has progressed well and will help the new Jingri - CUMI JV to grow rapidly with the increased reach.

Jingri Industrial Diamond Company (JINGRI) is one of the leading Synthetic Diamond manufacturing companies in China since 1970. With an installed capacity of nearly 120 million carat of Diamonds and with a strategic joint venture with Hyosung of Korea in another subsidiary named Yanjiao Jingcheng Diamond Tools Co., Ltd, to produce value added products with these diamonds, it's poised to break into the Global market with its range of value-for-money products catering to the Stone and Construction industry. Jingri's consolidated turnover for the year 2005 was about $ 10 million.

The Joint venture of Jingri with Hyosung D & P, Korea manufactures Diamond saw blades, Laser welded segmental saws and other diamond products for the Stone and Construction market. This is one of the fastest growing segments in the super abrasive industry, worldwide.

About Us
Carborundum Universal Ltd is part of the $ 1.60 billion conglomerate Murugappa Group. The group is one of India's largest family promoted, professionally managed corporates with over 28,000 employees. A pioneer and market leader in several fields with over 40 manufacturing operations across 12 states in India, the Group has a strong presence in abrasives, engineering and cycles, bio-products, sanitaryware, plantations, sugar, farm inputs, finance, general insurance, and nutraceuticals.

For further information, please contact:
Chandrika Raman
Sr. Manager - Group Corporate Communications
Murugappa Group
Tel: 044 - 25306535 / 98400 71172
Email: ChandrikaR@corp.murugappa.com