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French firm Arkema picks up 25% stake in Jayant Agro’s arm for $4.5M

France’s chemicals producer Arkema SA has acquired 24.9 per cent stake in a JV with Jayant Agro Organics Ltd, a Mumbai-based castor oil producer. The joint venture will manufacture and sell industrial and specialty grade castor oil products. Arkema will hold 25 per cent stake in the JV called Ihsedu Agrochem Pvt Ltd (IAPL).

Arkema is picking up the stake for Rs 27.9 crore ($4.5 million), the BSE was informed in a disclosure. Jayant Agro now holds 75.1 per cent of the total paid up equity share capital of IAPL. As part of the investment, Arkema Asie SAS has appointed two directors on the board of IAPL.

The announcement was made in April this year, but the deal size was not disclosed then.

After forming this separate venture, public-listed Jayant Agro will only focus on producing and marketing value-added castor oil products. BMR Advisors acted as the advisor to Jayant Agro Group on this deal while J Sagar Associates acted as the legal advisor to the group.

Jayant Agro, with a turnover of over Rs 1,800 crore, manufactures castor oil and castor oil-based derivatives. Castor oil comprises around half of its total revenues while castor oil derivatives offer higher margins.

Arkema is one of the top consumers of castor oil and the deal will provide it a secure source of raw material for its larger business focused on specialty polyamides made from castor oil. With operations in more than 40 countries, around 14,000 employees and 10 research centres, the firm generates annual revenues of €6.4 billion.

(Edited by Joby Puthuparampil Johnson)

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