UPL to integrate Indian, overseas crop protection biz into single entity

UPL, an agro, chemical company, announced on Friday that it will combine its Indian and international crop protection businesses to one entity, as the company aims at creating a focused pure play platform for this business's growth worldwide, and at the same time, simplifying the group structure.

According to a regulatory filing, UPL revealed that its board has given the green light to a combined scheme of arrangement between the company itself, UPL Sustainable Agri Solutions Ltd (UPL SAS), UPL Global Sustainable Agri Solutions Ltd (UPL 2), UPL Crop Protection Holdings Ltd (UPL Cayman) and their respective shareholders.

The proposed scheme plans to merge India crop protection business currently with UPL SAS and the global crop protection business currently with UPL Cayman, in one single entity, thus, the creation of a focussed, pure, play crop protection platform, UPL stated, further explaining that the scheme will simplify the group's structure and unlock shareholders' value.

As per the scheme, UPL SAS will be merged with the UPL in the first step.

Then, demerger of the demerged undertaking relating to the India Crop Protection Business from UPL to UPL 2. Lastly, there would be amalgamation of UPL Cayman with and into UPL 2.

The UPL 2 will be listed on the Indian stock exchanges. The process is expected to be completed in the next 12-18 months.

UPL has approved the “integration of the India-specific crop protection business and the international crop protection business into UPL 2 resulting in a single, unified platform for the crop protection business operating at the global level.” This integrated business will benefit from a strong manufacturing base, advanced research capabilities, a broad portfolio of registered products and brands across multiple geographies and independent management, UPL said.

After completion of the steps contemplated in the scheme, there would be two listed companies in the UPL Group.

UPL Ltd will continue to be listed and operate as a diversified platform encompassing agro and specialty chemical businesses, while also incubating and developing new businesses and verticals. The dedicated crop protection platform UPL 2 will be listed.

On the rationale of this scheme, UPL said that “this will enable clearer value discovery by providing flexibility to the investors to select investments which best suit their investment strategies and risk profile.” The scheme will allow the UPL and UPL 2 to raise capital independently, allowing each entity to optimise its capital structure and pursue business opportunities more efficiently and effectively, it added