UPL has raised US$ 500 million by divesting minority stakes in Advanta Enterprises Ltd (13.3%) and UPL SAS (9.1%) to marquee global investment firms at a ‘significant valuation premium’ to the listed parent company UPL Ltd.
Agrochemicals major UPL has announced that it will transfer its specialty chemical business including AI manufacturing to its wholly-owned subsidiary UPL Speciality Chemicals Ltd. (USCL) on a slump sale basis at a consideration of Rs. 3,572 crore. According to the filing in Bombay Stock Exchange, the slump sale is proposed to be done at a fair market value and subject to adjustments on closing. The process is envisaged to completed within 3 to 4 months from the date of shareholder approval.
The company said that the restructuring is aimed at unleashing growth potential of the distinct pure-play platforms with greater operational flexibility, dedicated teams and improved capital allocation. Hence, it expects a 10-15% CAGR over FY22-25. Further, it will facilitate accelerating growth in B2B active ingredients manufacturing business. Additionally, UPL expects to achieve better operational efficiency.
The international crop protection vertical has been transferred to UPL Corporation, Cayman. It has separated the global seeds business vertical under ‘Advanta Enterprise Limited' and India crop protection business and digital business under UPL Sustainable Agri Solutions.
UPL has also raised US$ 500 million by divesting minority stakes in Advanta Enterprises (13.3%) and UPL SAS (9.1%) to marquee global investment firms at a ‘significant valuation premium’ to the listed parent company UPL Ltd.
The company says that USCL is uniquely positioned to capitalize on opportunity in specialty chemical market. USCL manufactures and supplies chemicals to UPL Group Companies (UPL Corporation and UPL SAS). It also supplies chemicals to 600+ external B2B clients including large MNC and domestic companies operating in high growth sectors (Agchem, Pharma, Paints, etc.). USCL has strong manufacturing base of 12 technical plants in India and an R&D facility.
USCL is number one specialty chemicals company in India with revenue of over Rd. 15,000 crore. It was incorporated in FY 2022-23 to house specialty chemical business. Its standalone turnover in FY22-23 was Rs.15.16 crores.
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