Global private equity firms Brookfield, ADIA, and KKR have agreed to invest a total of $500 million (approximately Rs 4,040 crore) in group companies of Mumbai and London-based agriculture solutions provider UPL, including its Indian subsidiary Advanta Enterprises.
“A wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA), Brookfield and TPG to invest Rs 1,580 crore (around $200 million) for 9.09 per cent stake in UPL SAS – India agtech platform at an equity valuation of approximately Rs 17,380 crore ($2.2 billion),” Mumbai-listed UPL said in a regulatory disclosure.
KKR will invest $300 million (approximately Rs 2,460 crore) for a 13.33 percent stake in Advanta Enterprises – global seeds platform’ at a $2.25 billion equity valuation (around Rs 18,450 crore).
The ADIA arm and TPG will own 22.2 percent of UPL Cayman, which will be the Global Crop Protection Platform (ex-India), according to the announcement. Meanwhile, for $241 million, both entities will exit UPL Corp’s non-crop protection business, which includes the International Seeds business and other global non-crop protection businesses (Decco, Animal Health, and Health & Nutrition). The ‘Corporate Realignment’ exercise is expected to take 45-90 days to complete, subject to customary closing conditions and required approvals.
In 2015, LSE and Mumbai-listed agrochemical major UPL (formerly United Phosphorus Limited) had announced its merger and partnership with its group firm Advanta, a supplier of seed and seed technologies. The Shroff family-promoted UPL is present in more than 138 countries, employing more than 13,000 people globally.
“Since the acquisition of Advanta in 2006, UPL has built Advanta into a leading global seed company with presence in more than 80 countries. Today, Advanta is a leading player in sustainable agriculture solutions, benefitting the livelihoods of farmers globally. As sustainable farming practices increases in priority around the world, Advanta is well poised for its next leg of robust growth,” said Jai Shroff, Group CEO of UPL.
The company said that KKR will make its investment from its Global Impact strategy, which invests in businesses delivering solutions to address critical global challenges, and contributing towards the United Nations Sustainable Development Goals.
“We are pleased to invest in Advanta, a global leader in sustainable agriculture, at a time when food security has grown in importance amidst geopolitical tensions and climate change. Advanta has built a diversified platform with differentiated products and an excellent track record, and we are excited to leverage KKR’s global network, operational and ESG (environmental, social, and governance) management expertise to strengthen its business, implement industry best practices, and achieve its next phase of growth,” said Gaurav Trehan, Partner and CEO of KKR India.
KKR has been actively closing deals in India, with the most recent investment of $450 million (approximately Rs 3,585 crore) in Hero Future Energies (HFE), the Hero Group’s renewable energy arm. It signed a deal with home décor startup Livspace and acquired a minority stake in Shriram General Insurance earlier this year. KKR had committed more than $25 billion in equity to climate and environmental sustainability investments as of December 31, 2021.