Promoters of leading edible oil company KS Oils are in talks with Ruchi Soya Industries and global majors Archer Daniels Midland (ADM) and Cargill to sell their stake, said industry sources.
KS Oils, which sells edible oils in popular brands such as Kalash, Double Sher and KS Gold, has appointed DSP Merrill Lynch as the merchant banker and PwC as the consultant for the stake sale, sources said. The promoters are reportedly looking to offload their 35.01% stake. KS Oils? market capitalisation was slightly more than R425 crore on Thursday. Its share closed down 6.1% on BSE at R10. The Sensex fell 0.85%.
The company accounts for around a quarter of branded mustard oil sales, with an 11% share in the segment. Its sales rose 15.8% to R4,662 crore in the fiscal ending March 31, although net dipped 16.1% to R188 crore. The company ended the fiscal with an earnings per share of R4.55, compared with R5.71 in 2009-10.
Ashwini Garg, vice-president (commercial) KS Oils, declined to comment, saying, ?I am not authorised to comment on the issue?.
Managing director Sanjay Agarwal wasn?t available for comment despite repeated attempts.
One of the sources said although Ruchi Soya and Cargill are in talks, Illinois-based ADM seems to be keen on the stake to boost its presence in India. With net sales of $81 billion in the fiscal year through June, ADM is among the world?s leading processors of oilseeds, corn, wheat and cocoa. An email sent to ADM remained unanswered.
While the Cargill spokesperson was not available for comment, Yogesh Kolte, the head of corporate communications at Ruchi Soya, said: ?Our company policy does not allow us to comment on market rumours.? Ruchi Soya a major manufacturer of edible oils, soya foods and vanaspati is the country?s largest exporter of soyameal. The company?s consolidated turnover as of March 31 crossed Rs 18,000 crore.