Zuari Agro Chemicals, the agriculture vertical of the Adventz Group, has decided to sell its fertiliser plant in Goa to unlisted joint venture company Paradeep Phosphates (PPL) for a total consideration of USD 280 million.
The company's board has given in-principle approval for the sale on strategic and financial grounds.
It will, however, be subject to a due diligence by PPL -- a joint venture between Zuari Agro and Morocco-based OCP Group.
If the sale fructifies, PPL will become a large fertiliser company with access to both phosphates and nitrogenous fertilisers. The proceeds from the transaction will be utilised to take care of the long term liabilities of Zuari Agro Chemicals.
Zuari Agro Chemicals and OCP hold 50 percent each of the total equity capital of Zuari Maroc Phosphates (ZMPPL), while ZMPPL holds 80.45 percent of the share capital of PPL.
Moreover, the board of Zuari Agro Chemicals also approved investment to the tune of USD 46.5 million (around Rs 354.57 crore) in the share capital of its subsidiary Zuari Farmhub by the OCP Group and execution of an agreement in this regard.
In Q4/FY20, Zuari Agro Chemicals posted a consolidated net loss of Rs 304.60 crore due to closure of its phosphatic manufacturing capacity in Goa, as compared to a loss of Rs 255.17 crore in Q4/FY19.
The total income declined to Rs 1,031.93 crore in Q4/FY20 from Rs 2,001.30 crore in Q4/FY19.
The consolidated results include those of its joint ventures and subsidiaries including Mangalore Chemicals & Fertilisers, Adventz Trading DMCC (ATD), Zuari Farmhub, Zuari Maroc Phosphates, Paradeep Phosphates and Zuari Yoma Agri Solutions.