Mumbai-based Jayant Agro Organics Ltd has joined hands with France’s chemicals producer Arkema SA by roping it as a partner in a new joint venture to manufacture and sell industrial and speciality grade castor oil products. Arkema will hold 25 per cent stake in this JV called Ihsedu Agrochem Pvt Ltd.
After forming this separate venture, public-listed Jayant Agro will only focus on producing and marketing value-added castor oil products. But it could not be immediately ascertained if Jayant Agro will move its existing castor oil business to the new JV.
BMR Advisors acted as the advisor to the Jayant Agro Group and J Sagar Associates acted as the legal advisor to the group on this deal.
Mumbai-based Jayant Agro, with a turnover of over Rs 1,800 crore, is engaged in manufacturing of castor oil and castor oil-based derivatives. Castor oil comprises around half of its total revenues as of now while castor oil derivatives also form a large chunk of its business. However, the latter has much 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 Sanghamitra Mandal)