Dhanuka sells stake to 20-20 Equity Investors

Dhanuka Agritech said it has sold eight per cent stake in the firm to Mauritius-based private equity player.

Dhanuka Agritech said it has sold eight per cent stake in the firm to Mauritius-based private equity player 20-20 Equity Investors for Rs 34 crore.

“We will use the proceeds from the 20-20 Equity Investors deal to finance our Rs 30-crore expansion programme at Sanand plant in Gujarat,” Dhankua Agritech Chief Financial Officer V K Bansal said.

Apart from the Sanand plant,Dhanuka Agritech has three more pesticides manufacturing facilities at Guragaon and Sohona in Haryana and Udhampur in Jammu and Kashmir.

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Following stake sell,the promoters’ stake in the company has reduced to 74.95 per cent.

Bansal said that the deal with 20-20 Equity Investors was signed late last month and Dhanuka Agritech has no plans,as of now,to dilute further equity for fund raising.

“However,we are looking for one small seed company and a technical-grade pesticide making firm for acquisition. If,one of the deals clicked,we may look for a follow-on public (FPO) offer,” he said.

While the acquisition of the technical-grade pesticide manufacturing company would help the company to backwardly integrate,the seed firm buy would enable Dhanuka to be a bigger player in the business.

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Currently,the seed business contributes around three per cent to Dahnuka’s total turnover,which stood at Rs 445 crore last fiscal.

“We are likely to end the current fiscal with Rs 575 crore topline,” Bansal said.