Grasim Industries has decided to sell its fertilizer business to Indorama Corporation for Rs 2649 crore. The flagship company of Aditya Birla Group on Thursday approved the divestment of its fertilizer business, Indo Gulf Fertilizers, by way of a slump sale to Indorama India Pvt Ltd (IIP), a subsidiary of Indorama Corporation Pte. Ltd, Singapore, the company said in a regulatory filing.
"The transfer of the business will be for a lump-sum cash consideration of Rs 2649 crore to be paid by IIP to Grasim. This consideration is commensurate to the strength and future potential of the business," it said. The divestment of the fertilizer business is a significant value unlocking exercise for Grasim. It will further enable the company to pursue growth opportunities in its core businesses, the filing added.
The fertilizer unit had a turnover of Rs 2,679.51 crore in 2019-20 accounted for 3.45 percent of the total consolidated turnover of Grasim Industries, it said. Grasim Industries Managing Director Dilip Gaur said, "The divestment of the fertilizer business by Grasim is a strategic portfolio choice and unlocks value for the shareholders. It is in line with the strategic thrust of the company to focus on core businesses."
Indo Gulf Fertilizers is synonymous with strong performance and high sustainability standards. To take it to the next level in size and value, the company is pleased to have found in Indorama Corporation a credible fertilizer player to own IGF, he added. "IGF will benefit from synergies and expertise of Indorama Corporation's existing agri portfolio," Gaur said.
Indorama Corporation Vice-Chairman Amit Lohia said that with this acquisition, Shaktiman and the Paras brands will be able to join hands to offer a complete range of products for farmers. That will include urea, phosphate fertilizers, potash, soil health products, seeds, and crop protection products. "We are excited about this union and believe it will facilitate greater access and development of high-quality agri inputs for the farming community," he added.
Indo Gulf Fertilisers is engaged in manufacturing, trading, and sale of urea and other agri-inputs with a 1.2 million tonnes per annum urea manufacturing plant at Jagdishpur in Uttar Pradesh. (Source: PTI)