The State Bank of India (SBI) has acquired a minority stake in JSW Cement. SBI has invested Rs 100 crore in the company via compulsorily convertible preference shares (CCPS). The conversion of such CCPS into common equity of the company will be linked to the company’s future business performance and valuation determined at the time of the proposed initial public offering. This capital infusion will support JSW Cement’s capacity expansion from current 14 MTPA to 25 MTPA.
The SBI transaction with JSW Cement comes close on the heels of the Rs 1,500 crore investments made by two global private equity investors, Apollo Global Management Inc. (through its investment entity in Singapore) and Synergy Metals Investments Holding Ltd earlier this year.
According to Parth Jindal, Managing Director, JSW Cement said, “We are one of the fastest growing cement companies and the largest green cement company in India. In a short span of three years, we have increased our capacity from 6MTPA to 14MTPA and are now working towards achieving the 25MTPA milestone over the next 24 months. We take great pride in being the recipient of one of SBI’s larger investments through the private equity route. I take this opportunity to welcome SBI as a strategic investor at JSW Cement and look forward to a long & fruitful association with them.”
According to Narinder Singh Kahlon, Director Finance of JSW Cement, "Financing our growth and expansion strategy with investment from a power banking partner such as SBI sets us up very well for our planned IPO in the next 12-18 months. We look forward to a long-term association with SBI as we work towards building a New India by offering world-class environment-friendly cement products.”
