Dhanuka Agritech (507717) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of international rights for Iprovalicarb and Triadimenol aims to expand presence in over 20 countries, including key markets in Latin America, MENA, Europe, Asia, and India.

• Expanding from a domestic to a global player aligns with the long-term vision to increase international presence and leverage existing customer bases for future product launches.

• Acquisition of two Bayer fungicides with established registrations and customer base accelerates global market entry and strengthens product portfolio.

• Access to established brands and markets, especially in Brazil and Asia, provides entry barriers for competitors.

Financial terms and conditions

• Total purchase price for both products is approximately INR 167 crore.

• Combined global revenue for these products was about INR 224 crore in 2023, with an estimated decline to INR 186 crore in 2024.

• Peak revenue reached INR 245 crore in 2022.

Synergies and expected cost savings

• Manufacturing of Iprovalicarb will be shifted to India, utilizing the Dahej facility, and plans include sourcing technical ingredients from generic suppliers to reduce costs.

• Expected to maintain EBITDA margins at current levels despite slightly lower gross margins.