Coromandel International will acquire 45% stake in Baobab Mining and Chemicals Corporation (BMCC) for $19.6 million (Rs 150 crore approx.), besides a loan infusion of of $9.7 million (Rs 75 crore approx.) into BMCC for capital projects and expansion.
Baobab Mining and Chemicals Corporation (BMCC) is a rock phosphate mining company loacted in Senegal, Africa. The acquisition will be executed through Coromandel International's wholly owned subsidiary, Parry Chemicals. The transaction is expected to be completed in the second quarter of FY 2022-23 and is subject to satisfactory completion of conditions precedent as contained in the agreements, as per the company's exchange filing.
BMCC has stabilized its operations and commenced active production from 2021. This investment will help in strengthening Coromandel International's backward integration and ensure long term supply security of the key raw material. At full capacity, BMCC can meet upto one-third of the company's rock phosphate requirement.
Additionally, Coromandel International has made a tie up with integrated players like Tifert (Tunisia) and Foskor (South Africa) for meeting its phosphoric acid requirements. Further, it has been augmenting its captive phosphoric acid production at Vizag plant (Andra Pradesh) and is sourcing rock from various countries. As part of its strategy to strengthen the value chain, the company has been evaluating opportunities in the phosphate mining to secure its rock phosphate needs.
Coromandel International's consolidated net profit surged 85.94% to Rs 289.79 crore on a 49.63% rise in revenue from operations to Rs 4,226.81 crore in Q4 FY22 over Q4 FY21.
Shares of Coromandel International lost 0.16% to end at Rs 911.40 on BSE. Coromandel International is an India-based agri input solution provider and is in the business of fertilisers, crop protection, bio products, speciality nutrients, organic fertilisers and retail. It is a private phosphatic fertilizer manufacturer and marketer operating 3 fertiliser units for manufacturing 3 million ton of phosphatic fertilisers. Rock Phosphate is a key raw material for manufacturing phosphoric acid, an intermediate used for phosphatic fertiliser production.
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