UPL Ltd, controlled by the Shroff family, has agreed to acquire agri-pesticides maker Arysta LifeScience Inc and its subsidiaries — part of the US-based Platform Speciality Products Corporation — for $4.2 billion (around Rs 28,980 crore) in cash to become one of the world’s leading crop protection companies.
A wholly-owned subsidiary of the Abu Dhabi Investment Authority (ADIA) and TPG have partnered with UPL Corp, a subsidiary of UPL Ltd, to support the proposed acquisition. The transaction is backed by a $1.2 billion equity investment from ADIA and TPG. ADIA and TPG will each invest $600 million for a combined stake of 22 per cent in UPL Corp.
Besides, UPL Corp has received debt financing commitments of $3 billion for the balance of the consideration, with bullet maturity of 5 years, from MUFG Bank Ltd and Cooperative Rabobank U.A, Hong Kong.
Arysta is a global provider of innovative crop protection solutions, including biosolutions and seed treatment. It specialises in the development, formulation, registration, marketing and distribution of differentiated crop protection chemicals for a variety of crops and applications. The company employs around 3,300 people working in more than 60 countries, and had 2017 revenues of approximately $1.9 billion. “This acquisition will create a new UPL and fulfills UPL’s objective of creating an integrated patent and post-patent agricultural solutions business with a global footprint. Following the acquisition, UPL will be one of the world’s largest global crop protection companies, with an innovative and differentiated product portfolio,” UPL said in a statement.
UPL had posted a turnover of Rs 7,374 crore and a net profit of Rs 548 crore for the year ended March 2018.
The acquisition will give UPL access to a variety of patented products through collaborations and partnerships as well as enhanced in-house R&D capabilities, it said. UPL will have an integrated supply chain with a backward integrated manufacturing base in major markets and deep distribution capabilities across the globe to address needs of growers.
Jai Shroff, Group CEO and Executive Director of UPL, said, “the acquisition of Arysta is a transformational transaction for UPL. This is in line with our long-term vision of becoming a premier global provider of agricultural solutions designed to secure the world’s long-term food supply.”