Danone’s FDI issue slows proposal with Avesthagen

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New Delhi, Oct 15

Pending the issue of 'prima facie' violation of FDI policy by Groupe Danone's acquisition of minority shares in Avesthagen - a bone of contention between the Wadias and Danone - the Finance Ministry is contemplating a new FDI proposal involving an Avesthagen joint venture.

The new FDI proposal involves Ava Seeds - a 30:70 joint venture between biotech firm Avestha Gengraine Technologies (Avesthagen) and Limagrain.

According to sources, since the matter pertaining to the FDI violation in Groupe Danone's investment in Avesthagen has been referred to the Enforcement Directorate, the issue now is whether to take up the proposal of a downstream company of Avesthagen till the previous case is settled. The new proposal involves setting up of Ava Seeds as a 'holding company'.

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