Coromandel International, a supplier of agricultural materials and solutions from the Murugappa Group, will acquire a 45 per cent stake in Baobab Mining and Chemicals Corporation (BMCC), a phosphate mining company based in Senegal (Africa) for around Rs 225 crore.
The deal includes a loan of Rs 75 crore to the target company. The acquisition gives Coromandel access to phosphate, a key raw material for phosphoric acid production, an intermediate used to produce phosphate fertilizers.
Coromandel operates three fertilizer production units that produce about 30 lakh tons of phosphate fertilizers, making it the largest producer and seller of phosphate fertilizers in the country. “These investments will help strengthen Coromandel’s reverse integration and ensure long-term security of supply of key raw materials,” Arun Alagapan, executive vice chairman of Coromandel International, said on Friday.
At full capacity BMCC can meet up to one third of the company’s phosphate needs. The company has arrangements with players such as Tifert (Tunisia) and Foskor (South Africa) to meet its phosphoric acid needs. In addition, it increases the production of phosphoric acid in captivity at the Visakhapatnam plant and acquires stone from different countries.
The acquisition is through a subsidiary of Coromandel International, which is wholly owned by Parry Chemicals. The deal is expected to be completed in the second quarter of this fiscal year, the company said.
May 06, 2022