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<p><strong><a href="https://www.dealstreetasia.com/?s=UPL Ltd" target="_blank" rel="noopener">UPL Ltd</a></strong>. said it has agreed to acquire agri-pesticides maker <strong><a href="https://www.dealstreetasia.com/?s=Arysta LifeScience Inc" target="_blank" rel="noopener">Arysta LifeScience Inc</a></strong>. for $4.2 billion in cash to become one of the world’s largest crop protection companies.</p></article>

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<p><strong><a href="https://www.dealstreetasia.com/?s=UPL Ltd" target="_blank" rel="noopener">UPL Ltd</a></strong>. said it has agreed to acquire agri-pesticides maker <strong><a href="https://www.dealstreetasia.com/?s=Arysta LifeScience Inc" target="_blank" rel="noopener">Arysta LifeScience Inc</a></strong>. for $4.2 billion in cash to become one of the world’s largest crop protection companies.</p>
<p>Its wholly owned subsidiary UPL Corporation Ltd. signed a definitive agreement with Platform Specialty Products Corporation to acquire Arysta LifeScience and its subsidiaries, the Indian agrochemicals company said in a press statement. The deal, subject to regulatory approvals, is expected to be completed by early next year.</p>
<p>The buyout will be backed by a $1.2-billion equity investment by Abu Dhabi Investment Authority and TPG. They will invest $600 million each for a combined 22 percent stake in UPL Corp.</p>
<p>UPL said it intends to use a combination of newly issued equity and debt for the acquisition. It has received debt financing commitments of $3 billion for the rest.</p>
<p>Shares of the chemicals maker have fallen more than 14 percent in the last one month amid worries that the deal will increase UPL’s leverage. UBS, in a prior note, estimated that the acquisition could increase UPL’s leverage fourfold. Net-debt-to Ebitda may rise from 1 to 4.2 times if the deal goes through, it said.</p>
<p>Arysta LifeScience, a unit of William Ackman-backed Platform Specialty Products Corporation, makes agrochemicals to protect crops from weeds, insects and diseases. Arysta reported operating revenue of $2 billion and adjusted earnings before interest tax depreciation and amortisation of $424 million in the year ended March, according to UPL’s filing. It reported a revenue of over $1.8 billion in 2017.</p>
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<h3>Other Highlights</h3>
<p>According to the UPL statement and its conference call with analysts:</p>
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<li>Acquisition to not bring any additional debt from Arysta’s books.</li>
<li>UPL sees $5 billion in combined sales and $1 billion Ebitda.</li>
<li>More than 20 percent Ebitda margin pre-synergies expected.</li>
<li>Deal expected to be EPS accretive by Rs 10 to 12 in the year through March 2020.</li>
<li>Expects revenue synergies of $400-500 million in the next two-three years.</li>
<li>Net debt to EBITDA could rise to 3.2-3.5 times initially; will to fall to 2.2-2.5 times post synergies</li>
<li>The acquisition will give UPL access to a variety of patented products through collaborations and partnerships as well as enhanced in-house R&amp;D capabilities.</li>
<li>UPL will have an integrated supply chain with a backward integrated manufacturing base in major markets and deep distribution capabilities across the globe.</li>
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Its wholly owned subsidiary UPL Corporation Ltd. signed a definitive agreement with Platform Specialty Products Corporation to acquire Arysta LifeScience and its subsidiaries.

UPL to buy Arysta Lifescience in $4.2b cash deal

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UPL to buy Arysta Lifescience in $4.2b cash deal

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