Diversified Agribusiness company Godrej Agrovet Ltd (GAVL), a subsidiary of Godrej Industries Ltd, has announced the acquisition of promoter holding of 45.29 per cent in Astec Life Sciences Ltd. (ALS), thereby triggering an open offer to acquire an additional 26.05 per cent stake from minority shareholders. The open offer commences today ( Monday).
Astec, an Agro chemical company is listed on the NSE and BSE with a market cap of around Rs. 450 crore.
The promoters’ stake has been acquired at Rs.190 per share and it has cost Godrej Agrovet Rs.167 crore.
The open offer price has been fixed at Rs.246 per share.
In case the open offer is fully subscribed, Godrej Agrovet will spend additional Rs.125 crore to comply with the SEBI guidelines.
Astec has a large focus on fungicides. It operates in the space of technical as well as bulk sales in the country and also exports its products to more than 30 countries through its over 100 registrations.
The company also has contract manufacturing business, which undertakes production for its multi-national clients. Besides, it has good process and manufacturing capability, which can be leveraged by Godrej Agrovet to get into other products.
“It is a perfect fit into our business and it is a backward integration of our agro chemicals business which is growing rapidly," Balram Singh Yadav. Managing Director, Godrej Agrovet told The Hindu .
“We will retain the existing management team including the current Managing Director Ashok Hiremath and all employees. This company will be run independently,” Mr Yadav said.
Astec has 200 employees and two manufacturing facilities at Mahad.
Godrej Agrovet has a diversified agri retail business including a fast growing agro-chemical business focused on plant growth regulators and herbicides. It is a leader in selective post-emergence cotton herbicides in India.
This acquisition will allow the company to expand its agro-chemical portfolio into fungicides. Astec will also have the opportunity to sell its products through Godrej Agrovet’s channels.
In addition, both companies will have synergistic benefits of existing molecules as well as co-development of new molecules, officials said.
Ashok Hiremath, Chairman and Managing Director, Astec said “This investment by Godrej Agrovet recognises the growth potential of our business stemming from our strong product development capabilities, high quality manufacturing facilities and long standing relationships with global customers.
