Zuari Agro Chemicals Limited has informed the Exchange regarding Board meeting held on July 28, 2025.
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Zuari Agro Chemicals' board, at its July 28, 2025 meeting, approved subscribing to non-voting compulsorily convertible preference shares (CCPS) issued by its 50:50 joint venture Zuari Maroc Phosphates Pvt Ltd (ZMPPL) for up to ₹180 crore in cash. OCP S.A (the other JV partner from Morocco) will subscribe to an equal number of CCPS, so the 50:50 ownership stays intact. ZMPPL's standalone turnover was just ₹54 crore in FY24, but on a consolidated basis it turned over ₹11,606 crore with a net profit after tax of ₹90.67 crore. The investment is tied to the ongoing scheme of arrangement between Mangalore Chemicals & Fertilizers (MCFL) and Paradeep Phosphates (PPL), where ZMPPL needs to hold more than 50% of PPL. The board also signed an inter-se agreement making ZMPPL the sole vehicle for any future PPL stake acquisitions. The transaction is a related party deal but will be done at arm's length, subject to approvals including from Morocco's Foreign Exchange Office.
For shareholders, this is a ₹180 crore commitment into the JV to back the MCFL-PPL merger scheme and keep ZMPPL in control of PPL. Equal subscription by OCP protects Zuari Agro's stake from dilution, but the cash outflow and execution risk over the next 100 days are near-term overhangs. Long-term, it strengthens Zuari Agro's indirect exposure to the larger consolidated PPL/MCFL fertiliser business.