DSK Legal Advised TEMA India And Petron Saudi On Joint Venture Establishment In Saudi Arabia

DSK Legal advised TEMA India and Petron Saudi on joint venture establishment in Saudi Arabia

DSK Legal acted as common counsel, advising and assisting TEMA India Private Limited (“TEMA India”) and Petron Saudi Industrial Company Ltd (“Petron Saudi”) in connection with the establishment of a joint venture based in the Kingdom of Saudi Arabia (the “Region”).

TEMA India is a leading manufacturer of process equipment, specializing in the design, fabrication, manufacture, and sale of various heat and mass transfer equipment, including shell & tube heat exchangers, air cooled heat exchangers, pressure vessels, columns, reactors, waste heat recovery systems, fabricated pipe spools, and pipe connectors. Petron Saudi engages in manufacturing, fabrication, and sales of tanks, pressure vessels, steel structures, pipe spools, and skid-mounted systems.

The transaction involved the formation of a new joint venture entity (“JV Entity”) with equal 50:50 shareholding by TEMA India and Petron Saudi (together, the “JV Partners”). The JV Entity will undertake the business of designing, fabricating, manufacturing, and selling all types of heat and mass transfer equipment, including shell & tube heat exchangers, air cooled heat exchangers, pressure vessels above 38mm thickness, columns, reactors, industrial dryers, waste heat recovery systems, fabricated pipe spools, and pipe connectors in the Region. The JV Partners plan to establish large-scale manufacturing facilities for producing various types of shell & tube heat exchangers. The JV Entity has also been allotted a large parcel of land on a long-term lease by the Royal Commission of Jubail to set up manufacturing operations in the Region.

DSK Legal’s scope of work included structuring the transaction; drafting, reviewing, negotiating, and finalizing the memorandum of understanding between the JV Partners, the joint venture agreement, and other transaction documents; liaising with local counsel in the Region to assess the impact of applicable local laws on the joint venture; and assisting in closing the transaction.

The DSK Legal team representing the transaction comprised Jayesh Kothari (Partner) and Sreedatri Dhor (Associate). The team was assisted by Suhail Partners, local counsel in Saudi Arabia, on various local law aspects, including reviewing the definitive documents.

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