BASF India advances after parent to buy Bayer's seeds, herbicide biz

BASF India gained 1.94% to Rs 1,723 at 12:20 IST on BSE after the company said that BASF SE, Germany signed an agreement to acquire significant parts of Bayer's seed and non-selective herbicide businesses.

The announcement was made during market hours today, 13 October 2017.

Meanwhile, the S&P BSE Sensex was up 226.34 points, or 0.7% to 32,408.56. The S&P BSE Mid-Cap index was up 26.35 points, or 0.17% to 15,985.88, underperforming the Sensex.

On the BSE, 6,038 shares were traded in the counter so far, compared with average daily volumes of 5,880 shares in the past one quarter. The stock had hit a high of Rs 1,776 and a low of Rs 1,679.45 so far during the day. The stock had hit a record high of Rs 1,812.30 on 9 October 2017. The stock had hit a 52-week low of Rs 988.50 on 21 November 2016.

The stock had outperformed the market over the past one month till 12 October 2017, gaining 15.91% compared with the Sensex's 0.07% rise. The stock had, however, underperformed the market over the past one quarter, rising 0.26% as against the Sensex's 1.19% rise. The scrip had, however, outperformed the market over the past one year, gaining 40.63% as against the Sensex's 14.6% rise.

The mid-cap company has equity capital of Rs 43.29 crore. Face value per share is Rs 10.

BASF India said that it has received information from its parent company, BASF SE, Germany that it has signed an agreement to acquire significant parts of Bayer's seed and non-selective herbicide businesses which are being divested by Bayer in the context of its planned acquisition of Monsanto.

The all-cash purchase price by BASF SE is EUR5.9 billion, subject to certain adjustments at closing. The transaction is subject to the closing of Bayer's acquisition of Monsanto and approval by relevant authorities. The transaction is expected to close in the first quarter of 2018.

The assets to be acquired include Bayer's global glufosinate-ammonium non-selective herbicide business, commercialized under the Liberty, Basta and Finale brands, as well as its seed businesses for key row crops in select markets: canola hybrids in North America under the InVigor brand using the LibertyLink trait technology, oilseed rape mainly in European markets, cotton in the America and Europe as well as soybean in the America.

The transaction also includes Bayer's trait research and breeding capabilities for these crops and the LibertyLink trait and trademark.

For the full year 2016, the sales of the seed & non-selective herbicide businesses to be purchased from Bayer amounted to around EUR1.3 billion and EBITDA to around EUR385 million.

The acquisition complements BASF's crop protection business, strengthens its herbicide portfolio and marks its entry into the seed business with proprietary assets in key agricultural markets.

Net profit of BASF India declined 93.1% to Rs 0.68 crore on 8.4% rise in net sales to Rs 1507.17 crore in Q1 June 2017 over Q1 June 2016.

BASF India, the flagship company of BASF in India, is a public limited company with 73.33% of the shares held by BASF SE. BASF India is engaged in providing chemicals, plastics, performance products and crop protection products.

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