Ackman-Backed Platform Is Said to Discuss Unit Sale With UPL

(Bloomberg) -- A consortium including Indian chemical producer UPL Ltd. is in exclusive talks to acquire the Bill Ackman-backed Platform Specialty Products Corp.’s agricultural pesticides business, which could fetch more than $4 billion including debt, people with knowledge of the matter said.

Mumbai-based UPL is teaming up with sovereign wealth fund Abu Dhabi Investment Authority and other investors for the business known as Arysta LifeScience, according to the people, who asked not to be identified as the details are private.

Platform, the chemical maker whose biggest stakeholder is Ackman’s Pershing Square Capital Management, said Monday it had entered exclusive negotiations on a potential sale of Arysta to a suitor it didn’t identify. The West Palm Beach, Florida-based company is aiming to update investors by the time of its second-quarter earnings call, which is likely to be held in early August.

While the UPL consortium is in advanced talks, there’s no certainty that the negotiations will lead to an agreement and the final structure of the transaction is still being discussed, the people said. Representatives for UPL, Platform and ADIA declined to comment.

Serial Dealmaker

UPL traces it roots back to 1969, when it was founded as a manufacturer of red phosphorus used for striking matches. The shares are down about 12 percent this year, valuing UPL at roughly $5 billion.

Platform announced its intention last year to separate the crop chemicals business from its industrial chemicals division, at first planning to hive it off into a separate publicly traded company. Arysta LifeScience, which employs about 3,000 people, accounted for about half of Platform’s $3.8 billion in sales last year. Shares in the parent firm dropped 0.4 percent in New York trading Tuesday, amid a wider decline in U.S. equities.

This month, Platform said it was in talks with several suitors, including U.K. investment vehicle Wilmcote Holdings Plc, about a potential deal. Wilmcote said Monday that talks between the companies have ended, though the London-based company would “monitor developments with continued interest.”

Platform was founded by serial dealmaker Martin E. Franklin in 2013. Pershing Square is Platform’s largest shareholder, with a 14 percent stake, according to data compiled by Bloomberg.

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