JAKARTA (TheInsiderStories) – Indonesian billionaire Sri Prakash Lohia through IRC Agrochemicals Private Ltd. plans to buy Indian’s Tata Chemicals Ltd‘s phosphatic fertiliser business for Rs375 crore (US$58.05 million). The deal is expected to close by February 28, 2018.
It is not clear whether IRC Agrochemicals will also acquire Tata Chemicals’ 33 percent stake in Indo Maroc Phosphore, a company based in Morocco produce phosphoric acid, it produces phosphoric acid, an important raw material for manufacturing phosphatic fertilizer.
Lohia, born on 11 August 1952, is Founder and Chairman of Indorama Corporation, a diversified Indonesian petrochemical and textile company. He hails from India but since 1974 but has spent the majority of his professional life in Indonesia since 1974.
A Tata Chemicals announcement dated Nov. 6, 2017 reveals that Tata Chemicals considered and accepted the disposal and transfer of its Phosphatic Fertilisers business – including a trading business comprised of bulk and non-bulk fertilisers – by IRC Agrochemicals, with terms and conditions laid down in a Business Transfer Agreement (BTA).
The transaction would involve transfer of Haldia Plant, the Trading Business of bulk and non-bulk fertilizers, along with both immovable and movable properties, working capital and product brands, but excluding outstanding subsidy amounts.
The lump sum consideration for the transfer of the Phosphatic Business by way of a slump sale is Rs. 375 Cr, subject to certain adjustments after closing, as agreed between the parties in terms of the BTA.
The Board of Directors also approved the execution of definitive agreements between the Company, IRC and Indorama Holdings BV, Netherlands for the sale and transfer of the Phosphatic Business from the Company to IRC, pursuant to the BTA and subject to satisfaction of precedent conditions and all regulatory and other approvals, as may be required.
Tata Chemicals Limited Managing Director R. Mukundan commented, observing that this move builds on an earlier announcement with regard to the sale of the urea business, in a determined move to completely exit the fertilizer business.
He pointed out that this divestment is in line with the strategic direction of the company to focus on Speciality Chemical and Food businesses, while maintaining leadership in Inorganic chemicals and exiting the fertilizer business.
Tata Chemicals, is a global company with interests in businesses that focus on LIFE —Living, Industrial and Farm Essentials. The company a part of the over $ 100 billion Tata Group.
Meanwhile, Indorama, with subsidiaries in Asia, Africa, CIS and the Middle East, has interests in manufacturing Polyethylene, Polypropylene, Polyesters, Fertilizers (including Phosphoric Acid, which is a key input for the manufacture of DAP and other complex fertilizers at Haldia), Textiles and Synthetic Disposable Gloves. It is the largest produce of fertilizers in Sub-Saharan Africa.
Written by Linda Silaen, Email: email@example.com