UPL (formerly United Prosperous) has spun off Specialty Chemical business on a slump sale basis as a going concern to wholly-owned subsidiary UPL Speciality Chemicals for consideration of Rs 3,752 crore.

The international crop protection vertical has been transferred to UPL Corporation, Cayman.

It has separated the global seeds business vertical under ‘Advanta Enterprise and India crop protection business and digital business under UPL Sustainable Agri Solutions.

The company has raised $500 million by divesting minority stakes in Advanta Enterprises (13.3 per cent) and UPL SAS (9.1 per cent) to marquee global investment firms Abu Dhabi Investment Authority, KKR and Brookfield at a ‘significant valuation premium’ to the listed parent company UPL, said the company

The business realignment is expected to be completed in 3-4 months.

Specialty chemical business consists manufacturing ingredients used in making crop protection, pharma, paints, textiles, mining, flavours and fragrance, lubricants, water treatment, personal care, petroleum and oilfield products.

The spun-off speciality business has registered revenue of Rs 16,090 crore (including inter-segmental reporting) in FY’23. Net asset value will be Rs 3,572 crore.

The decision to spun off specialty business facilitates better value creation for stakeholders, allow to have differentiated play in the fast growing agrochemical and specialty chemical markets and in scaling-up the specialty chemical business at a faster pace.

It will also accelerate growth in B2B active ingredients manufacturing business and help achieve better operational efficiency, said the company.

Post the transfer completion, the specialty chemicals business will supply active ingredients to UPL and its affiliates wherein UPL Corp supplies formulations for exports and UPL SAS supplies formulations for domestic sales.

Related Topics
comment COMMENT NOW