Financial Daily from THE HINDU group of publications
Friday, Jan 25, 2002
Isagro unveils Indian arm
MUMBAI, Jan. 24
THE Isagro group, an Italy-based crop protection products company, on Thursday officially announced the formation of a new company called Isagro Asia, born from Isagro's acquisition late last year of the agri-chemicals division of RPG Life Sciences.
Isagro Asia is a 100 per cent subsidiary of its Italian parent, which has taken over all fixed assets through Rs 42 crore as equity and Rs 11 crore as semi-equity.
Unlike the Italian company, which believes in proprietary products, the agro-chemicals division of RPG Life Sciences had been selling generic products - with a domestic market share of 2.27 per cent - its best-known brand being Fenval, an insecticide, which has 28 per cent share in its segment.
At its Panoli works, Isagro Asia has the capacity to make 1,500 tonnes of Fenval, the plant's overall capacity dependent on what product-mix it chooses to operate on, Mr Partho S. Lahiri, Managing Director, Isagro Asia, told newspersons.
It is likely that some of its generic products may be phased out to make room for Isagro's preferred proprietary products, Fenval itself being a "declining product''.
Outlining the road ahead, Mr Giorgio Basile, President & Managing Director, Isagro, said that the Indian operation's distribution arm might be spun off into a separate joint venture. "It is an idea.''
According to Mr Lahiri, the preferred partner would be a multi-national with non-competing products. The equity sharing ration will be on 74:26 basis with Isagro Asia holding majority. The joint venture will be called Isagro India, according to Mr Basile.
He added that the single most important reason for the acquisition of the RPG Life Sciences' agri-chemicals division was the access it gave to Indian expertise in chemical synthesis.
"In the chemical industry in general, and agri-chemicals in particular, there is so much over-capacity that you can contract manufacturing capacity at cheap rates. What you can't contract like that is the ability to think,'' he said.
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