Grasim Industries, a unit of the Aditya Birla Group, is planning to acquire Terrace Bay Pulp Mill in Canada, according to a filing with the stock exchanges.

The company entered into an agreement to acquire the assets of the Terrace Bay Pulp Inc through its special purpose vehicle, AV Terrace Bay Inc., Canada. Terrace Bay Pulp is a firm operating a paper grade pulp mill in North America.

“Grasim will be holding 40 per cent interest in the proposed SPV while Thai Rayon Public Co. Ltd., Thailand will be holding the balance,” company said.

It will be the second such acquisition for the world's largest viscose staple fibre (VSF) business. Terrace Bay Pulp is located on the north shore of Lake Superior in Canada. The acquisition will help the company expand capacity at a time when it is investing heavily to expand capacity to 1 million tonnes from about 750,000 tonnes.

The shares of Grasim Industries rose 1.26 per cent intraday on Friday. They were then trading at Rs 2,680.05, up Rs 17.55 after reports of the acquisition surfaced. The trading volume increased 46 per cent to 15,252 equity shares compared to a 5 day average of 10,415 shares.

The company now has a market capitalization of Rs 24,581.86 crore.