Sahyadri Farmer Producer Company (FPC) receiving the required regulatory approvals to split the farmer facilitation and post-harvest care business could set a trend for FPCs. Till now, only producers/farmers could be FPC shareholders and capital could only be raised from them or through internal accruals.
Vilas Vishnu Shinde, chairman, Sahyadri FPC, said the new corporate structure has enabled farmers to continue with collective farming and be part of value creation through the subsidiary, which could raise growth capital from non-producer investors.
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However, regulators have stipulated that the shareholding of the parent FPC in the subsidiary should not fall below 51%.
Rahul Rai, partner, Incofin India, an investment firm, said Sahyadri FPC would become a model for other FPCs to follow, give confidence to the sector and show them the pathway to scale.
Alpen Capital, strategic advisors to Sahyadri Farms for the transaction, said Sahyadri had overcome the most difficult part of the process and cleared all the legal hurdles and there would be no roadblocks to the expansion and growth of the FPC.