TheCropSite.com- news, features, articles and disease information for the crop industry

News

CCI Clears Wilmar-Renuka Sugars Deal

04 June 2014

INDIA - Competition Commission of India, a fair play watch dog has cleared purchase of shares by Singapore-based Wilmar Sugar Holdings in Shree Renuka Sugars.

In its order, CCI said, "The proposed combination is not likely to have an appreciable adverse effect on competition in India".

Under the proposed deal, Wilmar would acquire shares of Shree Renuka Sugars through a preferential allotment and a consequential open offer to the shareholders.

CCI also felt that the clearance will not have an impact competition in the market, as Wilmar had no presence in India in the business of refining of raw sugar, production of sugar and ethanol derived from sugarcane and generation of electricity/power from bagasse.

The order also said that Wilmar had relatively insignificant exports and imports of sugar from India during the preceding financial year.

"In view of the foregoing and considering the presence of a large number of organised and unorganised players in sugar industry in India, the proposed combination is not likely to give rise to any competition concern in India," CCI order adds.

As per the deal finalized in February 2014, Wilmar will buy 27.5 per cent shares of Shree Renuka for $83 million through a preferential allotment of shares. It will be followed by a mandatory tender offer to buy up to 26 per cent from Shree Renuka's public shareholders by Wilmar.

Shree Renuka Sugar currently seven sugar mills in India with a total crushing capacity of 7.1 million tonnes per annum and two port based sugar refineries with capacity of 1.7 million tonnes per annum.

Globally, the company operates eleven mills globally with a total crushing capacity of 20.7 million tonnes per annum. The company also has significant presence in South Brazil, through acquisitions of Renuka Vale do Ivai and Renuka do Brasil.

Wilmar is part of the Wilmar International Ltd group that has various business interests such as in oil palm cultivation, oilseeds crushing, sugar milling and refining.

The companies had entered into agreements on February 20, 2014 following which they had filed a notice seeking the Commission's approval on March 11, 2014.

CCI is a government body responsible for enforcing the Competition Act, 2002 throughout India and to prevent activities that have an adverse effect on competition in India.

TheCropSite News Desk



Our Sponsors

Partners


Seasonal Picks

Country Dance