Jain Irrigation Systems Ltd's (JISL) agri-NBFC subsidiary Sustainable Agro-commercial Finance Ltd (SAFL) has raised Rs 112 crore ($17.9 million) from Mandala Capital (Mandala), which invests in agri-focused companies in India, according to a stock market disclosure.
The deal has been done through a mix of equity shares at a premium of Rs 42 crore and long-tenure debt of six years in the form of 10 per cent unsecured non-convertible listed debentures of Rs 70 crore, the company said.
With this, SAFL's tier 1 and tier 2 capital has been raised to Rs 208 crore ($33.2 million).
Post this transaction, Mandala Capital holds 20 per cent stake in SAFL while JISL’s shareholding has come down to 49 per cent. IFC is another investor in the firm.
Founded in 2011, Mumbai-based SAFL provides loans to small-scale farmers to help them install micro-irrigation systems and improve productivity. The company has so far served over 15,000 farmers since its inception.
Jalgaon-based Jain Irrigation is one of the largest players in the agro-industrial business, controlling a large chunk of the irrigation market, particularly in the micro and drip irrigation segment. It owns companies and plants throughout India, as well as in the US, the UK, Turkey, Switzerland and Israel.
The company has business presence in three complementary sectors – water and irrigation; agriculture, farming and food processing; and clean energy, including solar energy.
Mandala Capital manages a dedicated agribusiness private equity fund doing deals in agri-technology, seed, sugar and cold storage, with a geographical focus on companies based in India or addressing the needs of the Indian market.
The Mandala Agribusiness Fund is backed by University of Texas Investment Management Company (UTIMCO) and TIAA-CREF as its anchor investors.
Last year, it invested Rs 150 crore in Gati Kausar India Ltd, the cold chain arm of Gati Ltd.
NBFCs have attracted lot of private equity capital over the last few years from marquee and mid-market investors.
(Edited by Joby Puthuparampil Johnson)