The Capital Quest | KKR adds to India investment spree with bet on seed company

Alternative investment major KKR, which has had a busy 2022 in India, has sealed another private equity transaction in the agricultural business.

KKR has already signed nearly a half-dozen transactions in India so far this year. It also made a big-ticket exit, floated another infrastructure investment trust (InvIT) and completed the merger of its beleaguered finance arm.

The PE firm said Friday it will invest $300 million for a 13.33% stake in seed company Advanta Enterprises, a subsidiary of agriculture solutions and chemicals provider UPL, valuing it at $2.25 billion.

Advanta is focused on sustainable agriculture, providing farmers with locally adapted hybrid seeds, developed through research and advanced technologies in traditional plant breeding seeds. Currently, Advanta has a presence in 84 countries across Asia, Australia, Europe, United States and Latin America and Africa under global brands of Advanta, Alta and Pacific Seeds.

With a diversified portfolio of over 900 hybrids across more than 40 crops, Advanta is a key global player in tropical and subtropical corn, and maintains leading positions in many regions in corn, forages, grain sorghum, sunflower, canola, rice and vegetables.

KKR said it will make its investment from its Global Impact strategy, which invests in businesses delivering solutions to address critical global challenges, and contributing towards the United Nations Sustainable Development Goals.

Jai Shroff, Group CEO of UPL, said, “Since the acquisition of Advanta in 2006, UPL has built Advanta into a leading global seed company with presence in more than 80 countries. Today, Advanta is a leading player in sustainable agriculture solutions, benefitting the livelihoods of farmers globally. As sustainable farming practices increases in priority around the world, Advanta is well poised for its next leg of robust growth.”

Gaurav Trehan, Partner and CEO of KKR India, said, “Advanta has built a diversified platform with differentiated products and an excellent track record, and we are excited to leverage KKR’s global network, operational and ESG (environmental, social, and governance) management expertise to strengthen its business, implement industry best practices, and achieve its next phase of growth.”

Upon completion of the transaction, Advanta will operate as a standalone platform and aim to become a global sustainability leader in seeds. KKR looks to collaborate closely with Advanta to further expand its business regionally and globally, including through bolt-on acquisitions.

As of December 31, 2021, KKR has committed over $25 billion in equity globally to climate and environmental sustainability investments.

Last month, KKR inked a deal Hero Future Energies, Hero Group’s renewable energy arm. The previous month, it rolled out a $520 million InvIT.

Earlier this year, it bought 10% of Shriram General Insurance, invested in Livspace and inked a pharma bolt-on deal.

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