The Haldia plant is being sold to IRC Agrochemicals, which is owned by India-born, Indonesian billionaire Sri Prakash Lohia.
Tata Chemicals, a subsidiary of Tata Group conglomerate, has announced the sale of its phosphatic fertilisers business in Haldia to Indorama Corporation’s India entity IRC Agrochemicals for Rs 375 crore. The company’s board of directors accepted the transfer of phosphatic fertilisers business by way of a slump sale, the company said in a statement on Monday.
The Haldia plant (fertilisers segment) was temporarily closed earlier this year because of the ammonia pipeline relocation project and commissioning and a notice issued by the Central Pollution Control Board. The company said that this led to adversely impact on Tata Chemicals Q1 results. Tata Chemicals had reported a 14% fall in consolidated net profit at Rs 177.9 crore for the first quarter ended June 30, 2017.
Here are five things you need to know:
1. Tata Chemicals has announced the sale of its phosphatic fertilisers business in Haldia to IRC Agrochemicals for Rs 375 crore. The company’s Committee of Directors had recommended the deal.
2. The Haldia plant is being sold to IRC Agrochemicals, which is owned by India-born, Indonesian billionaire Sri Prakash Lohia.
3. The transaction would involve transfer of Haldia Plant, trading business of bulk and non-bulk fertilisers along with immovable, movable properties, working capital and product brands but excluding outstanding subsidy amounts
4. The disinvestment deal is a part of company’s strategic direction to focus on speciality chemical and food businesses and maintaining leadership in inorganic chemicals and exiting the fertiliser business.
5. Sri Prakash Lohia is the brother-in-law of Indian steel magnate Lakshmi Mittal and has the largest petrochemical company in West Africa. The deal will be Sri Prakash Lohia’s debut in the India fertiliser industry.
On the back of the news, Tata Chemicals’ shares raised as much as 2% on Tuesday morning. The Tata Group has about 100 operating companies, 29 listed entities and over 900 subsidiaries, but the top 10 companies account for 94 percent of the group’s revenues.