New Delhi, May 6 (PTI) Coromandel International Ltd on Friday said it is set to acquire 45 per cent stake in Baobab Mining and Chemicals Corporation (BMCC) in Africa for about Rs 150 crore and will infuse around Rs 75 crore as debt.
In a regulatory filing, the company informed that it is set to acquire 45 per cent equity stake in the BMCC, a rock phosphate mining company based in Senegal, Africa at an “outlay of USD 19.6 million (Rs 150 crore approximately), besides loan infusion into BMCC of a further USD 9.7 million (Rs 75 crore approximately).” The acquisition is happening through its wholly owned subsidiary Parry Chemicals Ltd. 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.
Coromandel International is India’s leading agri input solutions provider and is in the business of fertilisers, crop protection, bio products, speciality nutrients, organic fertilisers and retail. It is a leading private phosphatic fertiliser manufacturer. It operates three fertiliser units for manufacturing of around 3 million tonnes of phosphatic fertilisers.
Rock phosphate is a key raw material for manufacturing phosphoric acid, an intermediate used for phosphatic fertiliser production.
Coromandel has strategic tie-ups with leading 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 and is sourcing rock from various countries.
As part of its strategy to strengthen the value chain, Coromandel has been evaluating opportunities in the phosphate mining to secure its rock phosphate needs.
BMCC is in the business of mining, production, and sale of rock phosphate. BMCC has since stabilised its operations and commenced active production from 2021. This investment will help in strengthening Coromandel’s backward integration and will ensure long term supply security of the key raw material.
At full capacity, BMCC can meet up to one-third of the company’s rock phosphate requirement.
Arun Alagappan, Executive Vice Chairman, Coromandel International, said, “Given the high dependence on rock phosphate imports, which is a key raw material for manufacturing phosphoric acid, the proposed investment will be a step towards achieving long term sustainability and supply security goals for meeting country’s fertiliser needs.” PTI MJH MJH AJ AJ
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