Zuari Industries, part of Saroj Poddar-led Adventz Group, has acquired 30 per cent stake in Peruvian miner Fosfatos del Pacifico (Fospac) for $46.12 million. The stake buy has been done through a joint venture formed with Japanese conglomerate Mitsubishi Corp.
The deal comes after Zuari Industries formed a joint venture with Mitsubishi in Singapore for investments in rock phosphate assets. Zuari holds 30 per cent stake in MCA Phosphates Pte Ltd for an equity investment of up to $20 million.
Fospac has “mineralised material of 540 million MT phosphate rock (approx.), with an average P2O content of 18.5 per cent before beneficiation,” Zuari stated in a filing. The mine is located in Bayovar area in the Peruvian province of Pieura, and it is expected to have an initial production capacity of 2.5 million MT.
Mitsubishi has signed offtake agreement with Fospac for the entire production of phosphate rock. Zuari has back-to-back offtake agreement with Mitsubishi for 50 per cent of Fospac production of phosphate rock per annum.
BMO Capital Markets was the exclusive financial advisor to Zuari Fertilisers and Chemicals, a subsidiary of Zuari Industries, on its investment and offtake agreement in the rock phosphate project.
The share price of Zuari Industries was up 2.4 per cent to Rs 463 at 12:35 pm on Monday in a Mumbai market down 0.47 per cent.
Zuari Industries reported 23.2 per cent increase in revenues to Rs 7,599 crore in FY11 with net profit down 2.5 per cent to Rs 247.5 crore.