Apollo Global, Synergy Fund to Invest Rs 1,500 Cr in JSW Cement
Apollo Global Management is doubling down on Sajjan Jindal led JSW Group, joining Synergy Metals Investments for a Rs 1500 crore capital raise in the conglomerate’s cement business run by his son Parth, to fund its growth plans to become a 25 million tonnes scaled operations. The capital raise coincides with an uptick in demand from real estate and construction after lockdown resulting in most cement stocks outperform the Nifty over the past month and past year. Dubai-based Synergy Fund, spearheaded by Sudhir Maheshwari, a long time Arcelor Mittal executive, had already sought clearance from the Competition Commission of India for acquiring an equity stake in JSW Cement and got its clearance under green channel route on July 15th. Apollo is expected to sign its final agreement this coming week. JSW Cement will be issuing compulsorily convertible preference shares (CCPS) to the two investors who are each putting in Rs 750 crores at a post money valuation of around Rs 8500-Rs 8750 crore. The CCPS have a 5 year maturity or can be converted into equity shares earlier at the time of the company’s planned listing, scheduled in the next 18-24 months. Upon conversion, the investors can own up to 19% of the company. They also get a board seat each. JSW Cement is wholly owned by the Jindal family. The investments are seen as a precursor to the company’s initial public listing that was originally planned for last year but got pushed due to the pandemic to the second half of 2022.