Sugar major E.I.D. Parry (India) Ltd has said it has signed a term sheet to transfer its bio-pesticides business to its subsidiary Coromandel International Ltd for Rs 338 crore.
In a statement issued here, E.I.D. Parry said the transfer of the bio-pesticides business will be on slump sale basis along with its entire stake in its wholly owned subsidiary Parry America Inc, US.
This transaction is subject to receipt of necessary approvals including from the shareholders.
The bio-pesticides business is engaged in the manufacture and marketing of neem based Azadirachtin Technical and Formulations, plant extract based bio-stimulants, micronutrients, microbial bio-pesticides and others.
For the financial year 2016-17, the bio-pesticides business reported a consolidated revenue of Rs 123 crore and operating profit of Rs 24 crore, the statement said.
"The transaction is part of the strategic plan of the company to consolidate and focus on its core businesses in food and nutraceuticals space. Also, it would help the company to keep its gearing at a lower level to handle the sugar cyclical movements," A. Vellayan, Chairman, was quoted as saying in the statement.
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"The bio-products business would derive the synergy benefits by making inroads into South America, Africa and Asia where Coromandel has significant presence. Further, the company (E.I.D. Parry) would get benefited through the faster scale up of Bio Business under Coromandel fold by virtue of its majority stake in Coromandel," he added.
--IANS
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