Agro-chemicals major UPL Ltd has entered into an agreement with an Italian firm Sipcam SPA (Sipcam) to sell its entire 50 per cent stake in the Brazilian agrochemical company Sipcam UPL Brasil SA for $58.80 million (Rs 351 crore), as per a stock market disclosure.
Sipcam Isagro Brasil has products like insecticides, fungicides, acaricides, pesticides, nitrogenous and phosphatic fertilisers.
In 2011, UPL acquired 50 per cent stake in Sipcam Isagro Brazil from Isagro which was the joint venture between two Italian firms—Sipcam-Oxon group and Isagro. Post that, it got renamed as Sipcam UPL Brasil SA.
Sipcam held the remaining 50 per cent in the JV and post the latest deal, it will own 100 per cent of Sipcam UPL Brasil SA.
The transaction is expected to be completed by June 2014 and will help UPL release funds for new opportunities and meet growing business requirements. It will also help UPL to have more focused approach for Brazilian agrochemical market, one of the largest in the world.
Mumbai-based UPL (earlier known as United Phosphorus Ltd) is the largest agrochemical company in the country. In the quarter ended December 31, 2013, UPL saw a 15.3 per cent rise in revenues to Rs 2,647 crore with a net profit of Rs 222 crore, up 28 per cent over the year-ago period.
UPL, meanwhile, retains its presence in Brazil through another subsidiary. Last month it had increased its shareholding in Brazilian firm UPL do Brasil from 51 per cent to 73 per cent. Earlier in 2011, UPL Ltd had acquired a 51 per cent stake in UPL do Brasil, then known as DVA Agro Do Brasil, from Germany's DVA Group and other shareholders for $150 million.
Shares of UPL were quoting at Rs 188.75 a unit, up 2.50 per cent in a mid-day market on the BSE in a flat Mumbai market on Tuesday.
(Edited by Joby Puthuparampil Johnson)