Agro Tech to focus on strategic brands

Agro Tech Foods Limited (ATFL), a subsidiary of global food major ConAgra, has decided to sell its entire investment in Advanta India Limited to Advanta Finance B V, a wholly-owned subsidiary of Advanta Netherlands Holdings BV, so as to increase focus on its strategic brands and businesses.

Though ATFL believes that the seeds business in general and Advanta India Limited in particular have a very promising future in this country, its intention to disinvest in Advanta India Limited arises out of the company's business objectives and strategy going forward.

"This sale will enable ATFL to capture value from this non-strategic asset and invest it in value-added brands in its foods business. The realisation from the sale will also unlock cash, reduce borrowings and further strengthen ATFL's balance sheet," the company stated in a press release.

ATFL ,with a turnover of Rs 1,054 crore, has a strong presence in the edible oils and foods business in India with pioneer brands such as Sundrop, Crystal, Rath and ACT II.

ConAgra Foods Inc, along with Tiger Brands of South Africa, holds a majority stake of 51.3 per cent in the company through CAG Tech Holdings of Mauritius. Advanta India, on the other hand, is in the business of research, development, production and marketing of high-yielding hybrid seeds.

ATFL proposes to sell its stake in Advanta for a consideration of Rs 288.15 million. Seven years back, in April 1998, it had invested Rs 94.50 million in acquiring the equity stake in Advanta India.