3rd July, 2008

Carborundum Universal Ltd (CUMI) of India has entered into an Agreement with Foskor (Proprietary) Limited, South Africa to acquire 51% equity stake in Foskor Zirconia (Proprietary) Limited, Phalaborwa, South Africa, (FZL). This agreement is subject to regulatory approvals in South Africa.

With a 4200 tons per annum installed capacity for Zirconia, FZL is the 3rd largest producer of Zirconia in the world. Fumed silica is also produced as a by-product of the furnace operation. This investment will be a good platform for CUMI to address the growing minerals business. The sales of FZL in 2007-08 was about US $ 16 million.

Foskor was seeking a strategic partner to take FZL to its next phase of expansion and growth. CUMI, is one amongst the two companies globally with interests in Abrasives, Ceramics, Refractories and Minerals and was hence a logical choice.

CUMI is a fully vertically integrated company with operations in Australia, Canada, China, Russia, Middle East, US and in India. CUMI brings to FZL its mineral processing knowledge, its brands, market access, application engineering expertise and global management practices. This will help FZL to grow its range of products and business.

While CUMI through its investment subsidiary, will hold a 51% stake in FZL, the balance 49% will be held by Foskor (Proprietary) Limited and two other South Africa based entities. This change is expected to benefit FZL’s customers, employees and the community in Phalaborwa.