Rallis buys majority stake in Bangalore seeds co

Rallis buys majority stake in Bangalore seeds co

Mumbai: Rallis India Ltd said on Thursday it has bought a majority stake in Bangalore-based seeds research company Metahelix Life Sciences for Rs995 crore in an all-cash deal.

The deal marks its first inorganic foray into seeds, which is a key focus area for the firm, it said in a press release to the Bombay Stock Exchange (BSE).

Rallis, which has bought 53.5% in Metahelix, said it will fund the acquisition through internal accruals and plans to further infuse Rs250 crore to raise its stake to 59.02%.

It plans to further raise its stake in Metahelix to 100% over a period of 5-year, it said.

“We believe that revenues from the entity will exceed Rs1,000 crore cumulatively over a 5-year period. The deal works out to twice the projected revenues of next year," managing director V. Shankar said in the statement.

In 2009/10, Rallis, a unit of Tata Chemicals, posted a net profit of Rs101crore on revenues of Rs933 crore.

At 11.54, Rallis shares were up 1.27% to Rs1,335 in a weak Mumbai market.