Mumbai: The Tata group’s seeds and agro-chemical company Rallis India Ltd said on Friday it acquired a 22.8% stake in Zero Waste Agro Organics Pvt. Ltd, an organic manure and soil conditioners manufacturing company based in Maharashtra.
Rallis India, which had entered into a definitive agreement for the majority acquisition of Zero Waste Agro in April, completed the first phase of the deal under the terms of this by acquiring the initial tranche of shares.
In this phase, Rallis India is investing Rs10 crore on the acquisition. This will include Rs5 crore on investment in the company and Rs5 crore for the purchase of shares from current shareholders. Rallis has the right to increase its stake to 51% in a year’s time according to the definitive agreement.
“With this acquisition, Rallis India has further strengthened its product portfolio with organic manure and soil conditioner products to improve deteriorating soil health and drive agriculture productivity. We are confident that with Zero Waste as a part of our business, the organic manure business will spur the Rallis’ growth strategy,” V. Shankar, managing director and CEO, Rallis India, said in a release Friday.
With this initial stake deal, Zero Waste Agro will become a Rallis India controlled company through board representation and thus, will be a subsidiary of Rallis.
Rallis will also have exclusive sales and marketing arrangements with Zero Waste for domestic and international markets. Rallis has already initiated distribution of the product under brand name GeoGreen and the product has found acceptance among farmers. The Rallis India stock closed at Rs136.4, down 1.66 % on BSE on Friday.