EID-Parry (India) Ltd has entered into an agreement with GMR Holdings Private Ltd to acquire a majority equity stake in GMR Industries Ltd, the agri-business entity of the GMR Group, for an undisclosed sum.
GMR Industries, listed on the Bombay Stock Exchange and the National Stock Exchange, owns and operates three fully integrated sugar complexes in Andhra Pradesh and Karnataka, with a combined installed crushing capacity of 11,000 TCD (tonnes crushing per day), 46 Mw of power co-generation and 95 KLPD (kilolitres per day) of distillery output.
The agreement in this regard was signed today at Chennai by A Vellayan, chairman, EID Parry India Ltd, and K Balasubramanian, director, GMR Holdings. The GMR Group will divest a majority equity stake such that post the mandatory open offer (as in the regulations of the Security and Exchange Board of India), EID Parry would hold a minimum 65 per cent stake in GMR Industries. The GMR Group would become a minority shareholder.
The transaction is in line with GMR Group’s overall strategy to divest its non-core assets and focus on its infrastructure and energy businesses. Currently, the Group has significant interest in airports, energy, highways and urban infrastructure. Recently, the Group raised over $500 million to fund the expansion plans of GMR Infrastructure and GMR Energy.
Rothschild was the sole financial advisor to GMR Group on the transaction.
In a statement issued today, G M Rao, group chairman of GMR, said: “EID Parry is one of the most respected and renowned sugar companies in India. We are confident that this development would be rewarding and beneficial for all stakeholders, including the shareholders, farmers and employees of the company.”
The transaction consolidates EID Parry’s position as one of the leading sugar manufacturers in the cane-rich areas of North Karnataka and marks its entry into Andhra Pradesh. Late last year, EID Parry also acquired Sadashiva Sugar, with a capacity of 2,500 TCD and 15.5 Mw of co-generation in North Karnataka. EID Parry currently has a crushing capacity of 23,000 TCD.
Vellayan said: “This acquisition strengthens our position as one of the leading sugar companies in India and increases the number of integrated complexes. It thus provides EID Parry a platform to tap sugar markets other than Southern India.”