CUMI completes VAW acquisition

Chennai, September 7, 2007: Carborundum Universal Ltd, India (CUMI), has acquired on 7th September 2007, 84 per cent of the ordinary shares of Volzhsky Abrasive Works, located in the Volgograd Region of Russia, through its wholly owned subsidiary, CUMI International Limited, Cyprus for a consideration of around US $ 37 million.

Volzhsky Abrasive Works (VAW) holds on date 12.67 per cent of its ordinary shares as treasury investment, which represents approximately 10 per cent of VAW's charter capital. Cancellation of VAW's treasury shares will result in CUMI's holding going up to 96 per cent of the ordinary shares. An open offer for the balance 4 per cent ordinary shares is being made as per statutory requirements.

VAW is a leading producer of SiC grains, Bonded Abrasives products and Refractories. The sales in 2006 were about US$ 54 million. CUMI is one amongst the two fully vertically integrated players in the world in this space. The synergy between the 2 organisations is expected to enhance value and growth.

About CUMI
CUMI is one of the flagship companies of the $2 billion Murugappa Group. The company has pioneered the manufacture of coated and bonded abrasives in India and has made forays into other material science areas such as ceramics (Industrial Ceramics, Ceramic Fibre Refractory and Bonded Refractories) and electrominerals. CUMI is the largest company in the abrasives business in India.

About the Murugappa Group
Headquartered in Chennai, the USD $2 billion (Rs.8500 crore) Murugappa Group is India's leading business conglomerate. Market leaders in diverse areas of business including engineering, abrasives, finance, general insurance, sanitaryware, cycles, sugar, farm inputs, fertilizers, plantations, bio-products and nutraceuticals, its 29 registered companies have manufacturing facilities spread across 12 states in India. The organisation fosters an environment of professionalism and has a workforce of over 28,000 employees.

The Group has forged strong joint venture alliances with leading international companies like Roca, Cargill, Cerdak, DBS Bank, Mitsui Sumitomo and Groupe Chimique Tunisien and has consolidated its status as one of the fastest growing diversified business houses in India.

For further details, please contact:
V Ramesh
Sr. Vice President and Chief Financial Officer
CUMI
Ph - 044 42216132 / Mob: 099400-57663
rameshV@cumi.murugappa.com

Chandrika Raman
Asst. General Manager - Group Corporate Communications
Murugappa Group
Ph - 044 25306535 / Mob: 098400 71172
ChandrikaR@corp.murugappa.com