Shree Renuka Sugars (SRS) is negotiating a 25-28% reduction in the acquisition price for its proposed Equipav buyout. SRS will now have to pay anywhere between Rs 1,100 crore and Rs 1,150 crore against the earlier price of Rs 1,530 crore for Brazil’s seventh-largest sugar refiner.
SRS had announced plans to acquire Equipav in February. The buyout would have seen SRS pay Rs 1,530 crore besides assuming Equipav’s debt of nearly $700 million. However, the fall in global sugar prices, on the back of news of higher production in India and Brazil, forced SRS to re-negotiate the price.
The sugar industry hit a bad patch with the collapse in global prices. Most of the sugar company stocks have fallen. The management could have sought a higher haircut in the price though a 25-28% is also good. SRS, which is the country’s largest sugar refiner, paid $240 million to acquire another Brazilian sugar company VDI. This provided the company with a cane crushing capacity of 3 million tonne. With the Equipav acquisition in its pocket, SRS should have a cane crushing capacity of over 10 mt.
crackcrackCompany Name | CMP |
---|---|
Shree Renuka Sugar | 39.83 |
Bajaj Hindusthan Sug | 31.14 |
Balrampur Chini Mill | 537.05 |
Triveni Engg. & Inds | 453.75 |
Dalmia Bharat Sugar | 379.55 |
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