 "Sumitomo Chemical to buy 45% stake in Excel Crop Care")
Japanese firm Sumitomo Chemical Company (SCC) has agreed to acquire 45 percent stake in Excel Crop Care Ltd (ECCL), the Mumbai-headquartered agrochemicals company, from the Shroff family (the founder and promoter group of ECCL) and other financial investors for about Rs 624. While the Shroff family will off-load its 25 percent stake, Sumitomo Chemical will buy the remaining 20 percent stake in Excel Crop Care from Ratnabali Group.
The transaction, which is subject to certain conditions to close including regulatory approvals, represents part of Sumitomo Chemical Group’s efforts to enhance its agrochemicals business in India.
In accordance with the terms and conditions of the share purchase agreement, SCC will purchase the share at a price of approximately Rs 1,259.36 per share valuing ECCL at equity value of approximately Rs 1,386 crores. In addition, SCC together with its nominees will make the mandatory open offer to the public shareholders of Excel Crop Care to purchase up to an additional of 30 percent of the paid up capital of ECCL.
Excel Crop Care was carved out of Excel Industries Limited (EIL), founded by the Shroff family in 1941 with businesses related to chemicals and agrochemicals, as a standalone company in 2003 to give focussed attention on agrochemicals. With the divestment of stake in ECCL to SCC, the Shroff family has decided to focus on speciality chemicals, pharma intermediates, pharma actives, performance chemicals and environment and biotech products as a primary focus for its future activities across the various Shroff group of companies.
Dipesh Shroff, managing director of ECCL, commented, “We are very pleased to announce this transaction and believe that SCC has the right resources and expertise to lead ECCL in the next phase of growth.”
Over the years, the agrochemical market in India has grown steadily and substantially, averaging 6.4 percent per annum over the past 5 years, and is currently ranked the 9th in size in the world market. The India's market is expected to keep expanding at a high rate to meet a brisk demand for increased food production as the country's population will continue to rise.
Given such a consistent market expansion and future growth potentials, Sumitomo Chemical set up its manufacturing and marketing base in India back in 2000 and has thereafter constantly worked to fortify the foundation of its agrochemicals business in the country, including the recent acquisition of a local manufacturing company in 2010.
The share acquisition of Excel Crop Care, which is the 5th largest in revenue among agrochemicals companies in India, is another strong step forward in further promoting expanding and enhancing Sumitomo Chemical’s agrochemicals business in India. In addition, Sumitomo Chemical's enhanced access to Excel Crop Care’s robust product portfolio and distribution channels will be conducive to Sumitomo Chemical reinforcing its agrochemical business operation in areas outside India.
Ray Nishimoto, director and president of health and crop sciences sector, Sumitomo Chemical, commented, “Excel Crop Care’s extensive distribution network in India will complement SCC’s rapidly growing presence in India and create new opportunities for SCC’s proprietary products to penetrate into this key agrochemicals market. Further ECCL’s robust off-patent product portfolio and low cost state-of-the-art manufacturing facilities will enhance SCC’s capabilities.”
The transaction, which is subject to certain conditions to close including regulatory approvals, represents part of Sumitomo Chemical Group’s efforts to enhance its agrochemicals business in India.
In accordance with the terms and conditions of the share purchase agreement, SCC will purchase the share at a price of approximately Rs 1,259.36 per share valuing ECCL at equity value of approximately Rs 1,386 crores. In addition, SCC together with its nominees will make the mandatory open offer to the public shareholders of Excel Crop Care to purchase up to an additional of 30 percent of the paid up capital of ECCL.
Excel Crop Care was carved out of Excel Industries Limited (EIL), founded by the Shroff family in 1941 with businesses related to chemicals and agrochemicals, as a standalone company in 2003 to give focussed attention on agrochemicals. With the divestment of stake in ECCL to SCC, the Shroff family has decided to focus on speciality chemicals, pharma intermediates, pharma actives, performance chemicals and environment and biotech products as a primary focus for its future activities across the various Shroff group of companies.
Dipesh Shroff, managing director of ECCL, commented, “We are very pleased to announce this transaction and believe that SCC has the right resources and expertise to lead ECCL in the next phase of growth.”
Over the years, the agrochemical market in India has grown steadily and substantially, averaging 6.4 percent per annum over the past 5 years, and is currently ranked the 9th in size in the world market. The India's market is expected to keep expanding at a high rate to meet a brisk demand for increased food production as the country's population will continue to rise.
Given such a consistent market expansion and future growth potentials, Sumitomo Chemical set up its manufacturing and marketing base in India back in 2000 and has thereafter constantly worked to fortify the foundation of its agrochemicals business in the country, including the recent acquisition of a local manufacturing company in 2010.
The share acquisition of Excel Crop Care, which is the 5th largest in revenue among agrochemicals companies in India, is another strong step forward in further promoting expanding and enhancing Sumitomo Chemical’s agrochemicals business in India. In addition, Sumitomo Chemical's enhanced access to Excel Crop Care’s robust product portfolio and distribution channels will be conducive to Sumitomo Chemical reinforcing its agrochemical business operation in areas outside India.
Ray Nishimoto, director and president of health and crop sciences sector, Sumitomo Chemical, commented, “Excel Crop Care’s extensive distribution network in India will complement SCC’s rapidly growing presence in India and create new opportunities for SCC’s proprietary products to penetrate into this key agrochemicals market. Further ECCL’s robust off-patent product portfolio and low cost state-of-the-art manufacturing facilities will enhance SCC’s capabilities.”
You’ve reached your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%