Mumbai, Dec. 17: Singapore state investor Temasek will pick up a 19.99 per cent stake in Godrej Agrovet Ltd, a subsidiary of Godrej Industries, for Rs 572 crore.
The deal values Godrej Agrovet at around Rs 2,860 crore. HSBC was the adviser to the transaction.
In a statement today, Godrej Industries said the investment would be a combination of primary and secondary investment, with the primary investment intended to support Godrej Agrovet’s future expansion plans.
Godrej Agrovet Ltd (GAVL) is a diversified agri-business company with interests in animal feed, palm oil, farm inputs and poultry. It had sales of Rs 2,460 crore during 2011-12.
The animal feed division is the largest manufacturer of compound feed in India, producing more than 1.1 million tonnes annually.
The palm oil business manages over 45,000 hectares of smallholder cultivation across states such as Andhra Pradesh, Tamil Nadu, Karnataka, Mizoram, Goa and Orissa.
The company has a good market share in plant growth promoters and herbicides.
In poultry, it has a joint venture with Tyson Foods of the US and is represented by brands such as Real Good Chicken and Yummiez.
“We welcome Temasek as a partner. We believe their global credentials, knowledge of agri-business and excellent track record will be beneficial to GAVL. Godrej Agrovet has been a tremendous source of value creation for GIL and continues to be on a strong revenue and profit trajectory,” Nadir Godrej, chairman of GAVL, said.
While the announcement came after market hours, shares of Godrej Industries ended nearly a percentage lower on the stock exchanges.
Earlier this year, Temasek acquired around a five per cent stake in Godrej Consumer Products Ltd for Rs 685 crore. The Godrej group company had issued preference shares to Baytree Investments (Mauritius) Pte Ltd, indirectly owned by Temasek, at Rs 410 per share.