Coromandel, Sabero Boards Approve Merger

The board of directors of Coromandel International and its subsidiary Sabero Organics Gujarat Ltd (SOGL) approved the merger of SOGL with Coromandel.

Coromandel, along with its wholly owned subsidiary Parry Chemicals Limited and other Murugappa group entities, holds a 74.94% equity stake in Sabero. Public shareholders of Sabero will be issued shares in Coromandel in the ratio of 5 equity shares of INR1 each of Coromandel for every 8 equity shares of INR10 each of Sabero in terms of the scheme.

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SSPA & Co., Chartered Accountants, Mumbai provided the independent valuation report and the fairness opinion was provided by Axis Capital Limited.

Kapil Mehan, managing director, commented,  “The merger will not only enable the agrochemical business realize economies of scale but also enable Coromandel to leverage its distribution network to serve Indian farmers especially through the Mana Gromor retail stores.” Mehan also said the proposed merger will enable the agrochemical business to upgrade its product portfolio and compete in global markets.

Coromandel, India’s second-largest phosphate fertilizer producer, also posted third-quarter results, with consolidated sales totaling INR2756.18 crore, compared with INR2424.47 crore a year ago.

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Profit before tax for the quarter was INR145.78 crore, up from INR70.96 crore a year earlier. Net profit after tax rose to INR95.57 crore, compared with INR68.86 crore in the year-ago period.

On a standalone basis, Coromandel reported sales of INR2500.72 crore, compared with INR2308.94 crore and after-tax profit INR102.08 crore versus  INR68.65 crore last year.

Its Sabero Organics subsidiary posted sales of INR160.46 crores with profit after tax of INR3.72 crores, up sharply from INR124 crores and INR2.03 a year earlier, respectively. Liberty Phosphates posted sales of INR94.26 crores with profit after tax of INR2.17 crores, compared with INR118.69 crores and INR9.49 crores a year earlier, respectively.

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