United Phosphorus Limited (UPL) has picked up a 50 per cent stake in Sipcam Isagro Brazil (SIB) from Isagro. Sipcam Isagro Brazil is a 50/50 Joint venture between Sipcam-Oxon group (Sipcam) and Isagro. The investment will see Isagro exiting the Joint Venture while Sipcam will continue holding 50 per cent, along with UPL’s 50 per cent.

Sipcam Isagro is based in Uberaba, found in the Brazilian state of Minas Gerais.  Sipcam Isagro is a niche local producer and distributor in the Brazilian agrochemicals market. It has a formulation plant in Brazil with capabilities in various formulation types for crop protection products.

Jai Shroff, UPL Chief Executive Officer, said the investment comes as part of the firm’s strategy to break into the Brazilian market. According to Shroff, Brazil is a $7 billion market, ranking amongst the top 5 largest crop protection markets in the world. He further stated that given the high entry barriers this market enjoys, coupled with UPL’s limited presence locally, Sipcam Isagro represents a unique opportunity to kick start operations on a larger scale.

The joint development plan targets untapped and promising areas and addresses significant market opportunities, he said. UPL is the largest Indian agrochemical Company and is engaged in research, manufacturing, selling and distribution of agrochemicals and specialty chemicals across the globe. The Company’s revenue for the year ended March 2010 was about US$ 1,142 million.

The transaction is expected to close within month. Financial terms of the acquisition were however not disclosed. YES Bank was the advisor to UPL for the transaction.

UPL is a global generic crop protection, chemicals and seeds company, headquartered in India (Mumbai). UPL and Advanta, the two companies in the group, are listed on the Indian stock exchange, with a combined market capitalization of approx $2.5 billion.

Isagro operates on a global level, in 80 countries, in the agro-pharmaceuticals market– products for the protection of agricultural crops – and invests directly in the innovation and development of new molecules and other active ingredients with a low environmental impact.

The Group, with a headcount of roughly 800, carries out its production activities in 6 sites, 4 in Italy, 1 in India and 1 in Brazil, and distributes directly in Argentina, Brazil, Colombia, India, Spain and the United States. It is also present in other countries thanks to important local partners.

7 March 2011