Crystal Crop Protection Ltd, a specialty chemicals company, is acquiring three brands of Syngenta India Ltd as the company continues its focus on inorganic opportunities to pursue growth, said two people with direct knowledge of the matter. Crystal produces crop protection products such as insecticides, fungicides, herbicides, plant growth regulators and bio-stimulants.
The company will buy Syngenta’s Proclaim, Tilt and Blue Copper brands, all of which are leaders in their respective industries, said one of the people cited above, requesting anonymity as he is not authorized to speak to reporters.
The deal will enhance Crystal Crop’s penetration in rice, pulses, cotton, wheat, vegetable and grapes markets in India.
“Currently, these brands have a business size of more than $20 million collectively. The inclusion of these high equity brands in Crystal Crop’s portfolio will strengthen its overall crop protection solution to farmers and thus increase their farm productivity,” the person added.
Both the people did not disclose the value of the deal.
A spokesperson for Crystal Crop declined to comment.
Crystal Crop has been on an acquisition spree with the latest one being its fourth purchase in 2018. This year, it has acquired a chemicals plant from Cytec India Specialty Chemicals and Materials Pvt. Ltd, followed by Syngenta’s pearl millet and fodder seeds business, and four brands from FMC India, the Indian arm of US-based chemicals and insecticide-maker FMC.
According to the second person cited above, Crystal Crop has been taking advantage of macro trends in the industry that are giving rise to many inorganic opportunities.
“The industry has been consolidating and global companies are merging together. This is leading to two types of inorganic opportunities market. One is forced divestments by the regulators. The other inorganic opportunity is coming from global companies looking to rationalize their portfolios, wanting to exit some products,” he said, also requesting anonymity.
Crystal has made several acquisitions in the past too.
It had signed an agreement with Germany’s BASF SE in 2016 to buy the brand Bavistin. Crystal also acquired Hyderabad-based Rohini-Seeds Pvt. Ltd, Rohini Bioseeds and Agritech Pvt. Ltd in 2011, providing it a foothold in the seeds market.
Industry body Ficci said crop protection chemicals will play a vital role in achieving the target of doubling farmers’ income by 2022.
“To achieve higher yields, crop protection chemicals are expected to play a significant role. Simultaneously, it will also be critical to use them judiciously to maximize benefits and minimize the impact on non-targeted species,” it said in a report.
Crystal Crop meanwhile plans to go public and has filed draft documents in April with the markets regulator for an initial public offering (IPO) of ₹1,000 crore. The IPO comprises fresh issue of shares of up to ₹545 crore and an offer for sale of up to ₹455 crore from the promoter and existing shareholders, including Everstone Capital, according to the draft prospectus.
Switzerland-based Syngenta is one of the world’s leading agrochemical companies with over 26,000 employees across 90 countries. Its Indian unit makes herbicides, fungicides and insecticides.
Source: Mint