Zuari Agrochemicals (ZACL) on Tuesday said it will sell its fertiliser plant and the associated businesses at Goa to Paradeep Phosphates (PPL) for an enterprise value of USD 280 million (over Rs 1,100 crore).
The company's board, at its meeting held on Tuesday, approved the sale of its fertiliser plant at Goa and the associated businesses by way of a slump sale to PPL for a lump sum consideration (enterprise value) of USD 280 million, ZACL said in a statement.
ZACL's Goa plant is engaged in the manufacture, distribution, imports and sale of urea, DAP and various grades of NPK fertilisers under the "Jai kisaan" brand, with a total installed capacity of 1.2 million tonnes per annum.
The divestment of the Goa plant is aimed at consolidating the bulk fertiliser business and achieving a significant reduction of leverage of the company, it noted.
With this restructuring move, the company will now venture into specialty nutrients and retail through its wholly-owned subsidiary "Zuari FarmHub (ZFHL)" and the bulk business of Goa plant and Paradeep operations consolidated under its joint venture PPL.
Besides, the company continues to own 53 per cent shareholding in the south India focused company Mangalore Chemicals and Fertilizers (MCFL).
Going forward, the company intends to focus a dual strategy of growing the bulk fertiliser business through PPL and MCFL and the speciality business through ZFHL.
PPL and ZACL will soon be signing the definitive Business Transfer Agreement (BTA) with regard to this transaction.
The BTA will be subject to various statutory and regulatory approvals, it added.
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