Everstone-backed Crystal Crop said its acquisitions will help it strengthen its insecticide and herbicide portfolio. Photo: Pradeep Gaur/Mint.
Mumbai: Crystal Crop Protection Ltd, a specialty chemicals company focused on crop protection, on Monday said it has acquired four brands from American chemicals major FMC Corp., marking the company’s third inorganic growth initiative this calendar year.
Private equity firm Everstone-backed Crystal Crop said in a statement that its acquisition of Furadan, Splendour, Metcil and Affinity Force brands will help it strengthen its insecticide and herbicide portfolio.
Crystal Crop’s products cater to the entire lifecycle of crops—from sowing to harvesting—and it also provides crop protection solutions to farmers.
According to Ankur Aggarwal, managing director of Crystal Crop, the Indian market is seeing several inorganic opportunities due to a global consolidation wave and rationalization of portfolios by global chemical companies.
“The industry has been consolidating and these global companies are merging together. This is leading to two types of inorganic opportunities market. One is forced divestments by the regulators. This acquisition is also part of such an opportunity,” said Aggarwal.
The other inorganic opportunity is coming from global companies looking to rationalize their portfolios, wanting to exit some products, he added.
Crystal Crop is strongly focused on tapping such inorganic opportunities to help build a stronger connect in the market as well as to strengthen its existing portfolio of products.
“India is a large agri-economy and some of these products and brands have a strong presence in the market, they are well known and appreciated by farmers. That is one advantage that you get when you acquire these brands. We also look at the product mix of our portfolio and see that how we can fit in these products and how we can complement with our existing portfolio,” said Aggarwal.
This is Crystal Crop’s third acquisition in 2018. Earlier this year it acquired a chemicals plant from Cytec India Specialty Chemicals & Materials. It also acquired the sorghum, pearl millet and fodder seeds business of Syngenta India this year. In 2016, Crystal Crop acquired German firm BASF SE’s brand Bavistin.
Aggarwal believes the current trend of consolidation will continue in the near to mid term, thus creating more inorganic growth opportunities.
“We are sure that this trend will continue at least for the next couple of years, till things settle down and these mergers complete. We are seeing the consolidation trend globally, also in China, and my feeling is that there will be a lot of opportunity in India as well,” said Aggarwal.
Crystal Crop, which has filed for an approx ₹1,000 crore initial public offering plans to use some of the proceeds of the IPO to pursue inorganic growth opportunities. The proposed IPO comprises a fresh issue of shares of up to ₹545 crore and an offer for sale by existing shareholders.
“We continue to keep exploring and looking at such strategic opportunities. We have a good track record of acquiring such assets and overall the response and return on investments from these assets has been very good. So that encourages us to look for more such opportunities,” added Aggarwal.