The Hindu Business Line : NSL to hive off seed business; Blackstone to invest

Hyderabad, Dec. 30 NSL group, the Hyderabad-based company with diverse interests in seeds, IT SEZ development and renewable power, has decided to hive off the seed business into a separate company in order to focus more on this business.

NSL Seeds, a leading seed manufacturing and marketing company, has received a commitment for investments up to Rs 400 crore from the global private equity major Blackstone group. The investments would be in the range of Rs 250-400 crore.

Following the demerger, the Blackstone investments would move into the seed business.

Capital needs

According to Mr Prabhakar Rao, Chairman and Managing Director, the demerger and investments would help the company focus on the seed business and mobilise adequate capital required for the planned growth of this segment.

Mr Rao felt that the Blackstone investment would help the company graduate into a publicly-held globally competitive player in the next few years.

He, however, has not indicated when the company would go public.

Distribution

The company has a 1,000-distributor network in the country with a sales force of 350 men, a Blackstone release said.

The other businesses such as renewable power, IT SEZ development would continue to be privately held. Part of the investment would also be used for meeting the capital requirements of the projects in implementation in the group companies.

Financial player

Though the Indian seed industry has been getting investments from multinationals such as Monsanto, the Blackstone investment in Nuziveedu Seeds is significant in that it is coming from a financial player and not from a pureplay seed or agricultural company.

Mr Akhil Gupta, Chairman and Managing Director of Blackstone Advisors India Private Ltd, said his company saw a huge opportunity in the agriculture sector.

“We believe that Nuziveedu Seeds is an ideal partner to explore this potential,” he said.

JM Financial was the advisor for this transaction, which would be completed in April 2009.

More Stories on : Restructuring | Diversification | Seeds

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