Murugappa Group firm Coromandel International has sought fair trade regulator CCI approval to acquire a majority stake in NACL Industries.
NACL, a listed entity, operates in the agro-chemical sector. It offers crop protection products and active ingredients.
“CIL (Coromandel International Ltd) proposes to acquire certain equity shares in NACL. The proposed transaction is notifiable to the Competition Commission of India under section…of the Competition Act, 2002,” said a notice filed with the Competition Commission of India (CCI) on April 7.
In its submission to the CCI for the assessment of the proposed transaction, Coromandel International and NACL Industries said the business activities of the parties exhibit certain horizontal and vertical overlaps within the agro-chemical sector.
However, the precise definition of the relevant market(s) may be left open since the proposed transaction will not raise any adverse competition concerns.
The relevant markets affected include herbicides, fungicides, insecticides, active ingredients, and plant growth regulators (including biostimulants) in India, the notice said.
The companies have left the precise market definitions open, stating that the overlaps are not significant enough to impact market dynamics adversely.
“…Certain markets identified based on the vertical overlaps between the business activities of the Parties may also be considered,” it added.
Last month, Coromandel International Ltd announced to acquire a majority — 53 per cent stake — NACL Industries Ltd for Rs 820 crore.
The company also said that it proposes to make an open offer to the public to acquire up to 26 per cent of the equity share capital in agro-chemical firm NACL Industries, as per the Sebi takeover rules.
A share purchase agreement has been signed amongst Coromandel International, NACL Industries, the seller (KLR Products Ltd), K Lakshmi Raju (being a promoter) and Bright Town Investment Advisor (being a member of the promoter/promoter group of NACL), the company said.
The acquisition will help in expanding Coromandel’s scale, accelerating its entry into contract manufacturing business, fast-tracking new product commercialisation and expanding its product portfolio, it added.
Coromandel International reported a turnover of Rs 22,290 crore for FY23-24. It is a part of the Murugappa Group.
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