An affiliate of global private equity major Apollo Global Management has got approval from the Competition Commission of India (CCI) to invest in soon-to-be listed JSW Cement controlled by billionaire businessman Sajjan Jindal.
In July, Singapore-based AP Asia Opportunistic Holdings Pte Ltd, along with Synergy Group, said it would invest up to Rs 1,500 crore (around $201.7 million) to acquire a minority stake in the unlisted cement maker.
This will be a 50:50 investment with both Apollo and Synergy investing around Rs 750 crore each.
AP Asia is indirectly controlled by investment funds managed by affiliates of US-based Apollo Global Management, which had assets under management of around $472 billion as of 30 June 2021.
This deal will be the first investment in India by Apollo’s Hybrid Value Fund, which provides equity and debt capital solutions to private and public companies. For Synergy, meanwhile, it will be the fund’s biggest investment in India.
Synergy Group, which had already received the competition watchdog’s green signal a few weeks ago, will invest through Synergy Metals Investments Holding, an investment arm of Synergy Metals and Mining Fund, a private equity fund set up by a former executive of steelmaker ArcelorMittal, Sudhir Maheshwari, in 2015.
The vehicle is a strategic advisory firm and private equity fund that has deployed approximately $470 million across nine investments. The fund typically has an average investment size of $20-50 million in industrial, auto components, metals, mining and power sectors globally and focuses on special situations.
The transaction with JSW Cement 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).
JSW Cement aims to go public by the end of the next calendar year.
The firm is part of Jindal’s $13 billion JSW group that is engaged in manufacturing of cement, clinker and related products at its plants at Vijayanagar in Karnataka, Nandyal in Andhra Pradesh, Dolvi in Maharashtra, Shiva Works in Odisha and Salboni in West Bengal. It currently has a capacity of 14 million tonnes.