Citigroup Venture Capital International (CVCI) has sold 90% of its 4.95% holding in KS Oils for Rs.93 Cr in three bulk deals at Rs.50 per share to Baghmar Finlease, Saravana Enterprises and Siva Trade Consultancy.

It sold 1.87 Cr shares of its holdings of 2.02 Cr shares.

Citigroup through Citigroup Venture Capital International Growth Partnership Mauritius Ltd. invested Rs.90 Cr in KS Oil in 2006 through a mix of direct equity issue at Rs.180 per share for Rs.59.24 Cr and the balance was invested through subscription of warrants which were convertible into equity shares at the same price of Rs.180 per share.

After stock split in 2007, CVCI's average purchase price came to Rs.18 per share.

So far it has part exited KS Oils by selling part of its stake in two tranches. It sold some of its stake in 2009 at Rs.50 per share for Rs 160 Cr and sold 90% of its remaining 4.95% stake through bulk deals this week.

With the current deal, it has already made 3 times of its investment in 2006.

Transaction Reference: HBL

KS Oils produces mustard oil, soybean oil and palm oil and has a strong presence in the mustard oil market in India. It controls a market share of 11% in the overall mustard oil segment, with a 25% market leadership in branded mustard oil.

It has 5 manufacturing plants, marketing offices and plantations in India, Malaysia, Indonesia and Singapore.

It has three plants in Madhya Pradesh, one each in West Bengal and Rajasthan with a cumulative mustard seed crushing capacity of 4,400 tonnes per day (tpd), solvent extraction of 4,200 tpd and refining capacity of 1,600 tpd.

KS Oil, which owns mustard oil brands such as Kalash, Double Sher and KS Gold is planning to invest Rs.70 Cr to improve infrastructure facilities at its five plants.

The company also plans to undertake palm plantation on 35,000 hectares in Indonesia with an investment of Rs.850 Cr over the next three years. The company will invest Rs 150 crore to cover 7,000 hectares this fiscal.

Since last year, CVCI is making exits from its Indian portfolio. It recently exited JBF Industries by selling its 14.3% stake for Rs.120 Cr through open market. JBF also bought back two-thirds of total convertible holdings of CVCI for $60 Mn in JBF's Singapore -based subsidiary, JBF Global Pte Ltd.

CVCI's other Indian exits includes companies like HT Media, Lupin, Techno Electric, etc.

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