Serial entrepreneur and investor C Sivasankaran Group firm has thrown more weight behind the agro sector. After having picked minority stakes in top domestic edible oil companies, a group firm has acquired another 7% in cereals company Usher Agro to take the holding to over 12%, strengthening its position as the largest non promoter shareholder of the firm.
Siva Ventures’ wholly owned company Aiwo Ltd, that is into health food restaurant and spa business, has been aggressively buying shares of the firm from the open market to build its position. Apparently it took an exposure in the firm in the last quarter and as of December 31 held 4.7% in Usher Agro.
It has been buying shares continuously since January 1 and, as of February 21, held 12.16% in the company. This stake is valued at around Rs 39.3 crore or a little less than $9 million. Since the share price has remained around Rs 90-95 for most of last three months, the share build-up appears more of a strategic bet rather than averaging cost of initial purchase as the share market has been on a correction mode for the last one month.
The build-up of holding also links with other recent investors of the group in the agri-commodity space that could be tied up with a move to generate returns from the continuing boom in commodity prices.
Earlier, the serial investor’s group firms had hiked holding in Baring Private Equity and New Silk Route-backed edible oil firm KS Oils to 13.46% early this month, making it the largest institutional investor in the company ahead of New Silk Route that held little over 9% in the company as of end December. His group firms had earlier also picked stake in another large edible oil firm Ruchi Soya.
These investments are in the related field of processed foods which is the business of one of the group firms Sterling Agro Product Processing Pvt Ltd.
Usher Agro, that raised Rs 100 crore through a qualified institutional placement in late November, was rumoured two years ago to have initiated discussions with private equity firms such as Blackstone among others to sell a large stake.
Serial investor Siva had been active in picking stake in listed companies in India in either sectors in which his group already has a presence or as sectoral play (as in case of oil). Most recently, his group firm acquired a small stake in Sujana Towers, a company that is engaged in manufacturing telecom and power towers. This gels with Siva Group’s privately-held entity Siva Projects Engineering and Enterprises Limited, engaged in developing passive infrastructure for mobile communication towers and related services including operations & maintenance for tower operators.