India-based JSW Cement has entered into definitive agreements to raise up to INR15.000bn (US$201.2m) from two global private equity investors, Apollo Global Management Inc (through its managed funds) and Synergy Metals Investments Holding Ltd.
The transaction is a structured private equity deal wherein compulsorily convertible preference shares (CCPS) are being issued to the investors and the conversion of such CCPS into common equity of the company will be linked to the company’s future performance and valuation determined at the time of the initial public offering (IPO). This investment will help JSW Cement accelerate its capacity expansion from current 14Mta to 25Mta.
The Competition Commission of India has recently approved the transaction by Synergy Metals Investment Holding Ltd. Apollo’s transaction is subject to customary closing conditions including regulatory approval.
Mr Parth Jindal, managing director of JSW Cement, said, “JSW Cement is one of the fastest-growing cement companies and the largest green cement company in India. In a very short span of three years we have increased our capacity from 6Mta to 14Mta and are now working towards achieving the 25Mta milestone over the next 24 months. Synergy and Apollo are amongst the strongest investors globally and JSW Cement is pleased to partner with them in the next phase of our growth. This is a critical time for the company in our quest to be amongst the top five cement companies in India and we are delighted to have them on board. Apart from strategic capital to finance our growth, investments by Apollo and Synergy bring with them deep validation and trust in our brand. I would like to take this opportunity to welcome both investors on board and look forward to a long and fruitful association with them.”
According to Narinder Singh Kahlon, finance director of JSW Cement, "Financing our growth and expansion strategy with investments from Synergy and Apollo sets us up very well for our planned IPO in the next 12-18 months.
