UPL Seeks $3 Billion Loan to Buy Ackman-Backed Arysta
UPL will borrow $3 billion to fund its bid for Bill Ackman-backed Platform Speacialty Products Corp.
(Bloomberg) -- Indian chemical producer UPL Ltd. is seeking a loan of about $3 billion to help fund its bid for a Platform Specialty Products Corp. agricultural pesticides unit backed by shareholder activist Bill Ackman, people with knowledge of the matter said.
UPL has been asking banks for an 18-month bridge loan to back its offer for the business, known as Arysta LifeScience, according to the people. Mitsubishi UFJ Financial Group Inc. and Cooperatieve Rabobank UA are in talks to provide the financing, the people said, asking not to be identified because the details are private.
Bloomberg News reported last month that a consortium including UPL and Abu Dhabi Investment Authority was in exclusive talks to buy the business, which could fetch more than $4 billion including debt. The Abu Dhabi sovereign fund plans to contribute as much as $1.3 billion of equity to the bid, the people said.
The investor group hasn’t reached a final acquisition agreement, and details of the funding could change, the people said. Representatives for UPL, Rabobank and ADIA declined to comment. A representative for MUFG didn’t immediately respond to requests for comment.
Platform, whose biggest stakeholder is Ackman’s Pershing Square Capital Management, said last year that it intended to separate crop chemicals into a separate publicly traded company. In June, it said it entered exclusive negotiations on a potential sale of the business to an unidentified suitor.
Shares of UPL, which have dropped 26 percent this year, advanced 1.4 percent to 567.45 rupees at 12:05 p.m. in Mumbai. The benchmark S&P BSE Sensex rose 0.1 percent.
Arysta LifeScience, which employs about 3,000 people, accounted for about half of Platform’s $3.8 billion in sales last year. Florida-based Platform has said it aims to update investors on a deal by the time of its second-quarter results, which are likely to be announced in early August.
--With assistance from P R Sanjai and Dinesh Nair.
To contact the reporters on this story: George Smith Alexander in Mumbai at galexander11@bloomberg.net;Anurag Joshi in Mumbai at ajoshi53@bloomberg.net
To contact the editors responsible for this story: Ben Scent at bscent@bloomberg.net, ;Andrew Monahan at amonahan@bloomberg.net, Amy Thomson, Michael Hytha
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