Fertiliser maker Coromandel International announced on Thursday that it will buy the the promoters’ stake of 56 per cent in Liberty Phosphate Ltd at Rs 241 a share.
The firm, part of the Rs 22,000-crore Murugappa Group, will also make an open offer to acquire a further 26 per cent stake from shareholders at the same price. The total acquisition cost for Coromandel, depending on the subscription of the public offer, will range between Rs 348 and Rs 375 crore.
“The entire acquisition will be funded through our internal accruals. The buy will make Coromandel amongst India’s leading single super phosphate makers with a total capacity of over one million tonnes,” A. Vellayan, Executive Chairman, Murugappa Group, told mediapersons here.
Drop in profits
Lower fertiliser sales and poor rabi sowings in some parts of the country dragged down Coromandel’s net profit for the quarter ended December 31 by over 48 per cent.
It clocked a profit of Rs 68.65 croreagainst Rs 133.56 crore in the year-ago quarter.
Sales during the period touched Rs 2,308.94 crore, down by about 10 per cent from Rs 2,560.98 crore in the corresponding quarter of last fiscal. On the acquisition, Kapil Mehan, Managing Director, said the company will acquire all the three entities of the Liberty Group, which has six manufacturing facilities in Rajasthan, MP, Maharashtra and Karnataka. Its combined installed capacity is 9.6 lakh tonnes. Liberty is also setting up a 1.32 lakh tonne green field SSP unit at Rae Bareli.
“Under a separate agreement, we have agreed to acquire 100 per cent stake in Liberty Urvarak Ltd and the business of Tungabhadra Fertilisers through a slump sale,” he said. The Liberty Group has a market share of 14 per cent in the SSP segment, reporting a net profit of Rs 54 crore and turnover of Rs 489 crore in 2011-12.
amitmitra@thehindu.co.in