Paradeep Phosphates to raise ₹1,255 crore in fresh capital

Paradeep Phosphates Ltd. (PPL) is planning to raise up to ₹1,255 crore in fresh capital through an IPO to part finance the acquisition of the Goa facility of Zuari Agro Chemicals and retire a part of its debt.

PPL, formerly a public sector enterprise, is now a part of Saroj Kumar Poddar’s Adventz group, that owns Zuari Agro Chemicals and Chambal Fertilisers, among others.

The Centre is seeking to disinvest its balance stake of 19.55% in PPL through an offer for sale after which the private sector promoters would take full control of PPL.

Zuari Maroc Phosphates Private Ltd. (ZMPPL), a joint venture of Zuari Agro Chemicals Ltd. (ZACL) and OCP Group S.A. (OCP), currently holds 80.45% of the equity share capital of PPL.

To increase the size of the company and access new markets serviced, PPL had in March entered into a business transfer agreement (BTA) with Zuari Agro Chemicals for the purchase of its fertiliser plant in Goa at an enterprise value of more than ₹2,000 crore.

Post acquisition of the Goa facility, PPL's capacity would increase to a combined 3 MMTPA (million metric tons per annum) for DAP/ NPK (Di-ammonium Phosphate/ Nitrogen, Phosphorous, Potassium).

“PPL will selectively explore inorganic growth opportunities and target acquisitions that will strengthen our market position, enable us to expand our product portfolio and increase our sales, marketing and distribution network,” said Sabaleel Nandy, president and COO, PPL.

“The acquisition will help PPL to access the high fertilizer demand markets of Maharashtra and Karnataka,” Mr. Nandy added.

PPL would also utilise the fresh funds towards repayment/prepayment of certain borrowings and to meet general corporate purposes.