Henderson looks to exit agrochemical firm Sharda Cropchem through IPO

Mumbai-based agrochemical firm Sharda Cropchem Ltd has filed its draft red herring prospectus (DRHP) with market regulator SEBI for its maiden public offering. The issue, in which its private equity backer Henderson Equity Partners will exit, will see the secondary sale of around 25 per cent stake.

The issue involves sale of 22,555,124 equity shares led by Henderson Equity Partners. Besides Henderson, other selling shareholder include promoter group members Sharda R Bubna and Ramprakash V Bubna.

Henderson had picked up 15.87 per cent stake in the company in 2008 for Rs 100 crore. The shares were acquired at an average price of Rs 69.8 per unit, according to VCCircle estimates.

Edelweiss Financial Services and IDFC Capital are the book running lead managers for the IPO.

In 2012, VCCircle had reported that Sharda was looking at a new round of private equity funding which would include both a primary and secondary sale.

Sharda Cropchem, earlier known as Sharda Worldwide, was formed in 2004 through the merger of Sharda International and Bubna Enterprises. The company trades in generic agrochemicals, dyes and dye intermediates and conveyor belts. Sharda registers and markets off-patent agrochemicals across the world in sectors like herbicide, fungicide and insecticide.

Sharda's clients include Swiss speciality chemicals company Clariant, Germany's diversified chemical company BASF and German chemical and pharmaceutical major Bayer.

For FY13, Sharda Cropchem reported revenues of Rs 555 crore with profit after tax of Rs 84 crore. For the first six months of FY14, the company reported revenues of Rs 238 crore with profit after tax of Rs 52.6 crore.

Henderson has been exiting its investments over the last few years like Jubilant Organosys, HT Media and Hindustan Sanitaryware & Industries. Its last disclosed investment was $10 million in Delhi-based development sector consultancy IPE Global back in June 2011. Other portfolio companies of UK-based Henderson include apparel retailer Genesis Colors and renewable energy player Mytrah Energy.

(Edited by Joby Puthuparampil Johnson)

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