Mumbai-based Polygenta Technologies Ltd may raise up to Rs 22 crore ($3.6 million) from Ventureast Life Fund III, a fund managed by Ventureast Fund Advisors India Ltd, through a mix of preferential allotment of non-convertible debentures (NCDs) and compulsorily convertible preference shares (CCPS).
This is part of a wider fundraising plan where the company’s promoter PerPETual Global Technologies is bringing in around Rs 54 crore ($9 million) through CCPS issue.
Ventureast will be investing Rs 7 crore through CCPS, priced at Rs 47 a share, besides an NCD issue worth Rs 15 crore. The NCDs would be redeemable only after four years from the date of allotment and the yield to maturity on the NCDs will not exceed 15 per cent.
The proposed securities issue has got the shareholders’ nod at the firm’s AGM last week.
Polygenta is engaged in manufacturing and selling polyester filament yarn made with recycled polyethylene terephthalate content as a feedstock in India. It sells its products under the brand name PolyGold for various applications in the fields of automotive, home furnishings, fashion, denim and floor coverings.
It is part owned by PerPETual Global, a Mauritius-based holding company which owns a commercial patented process known as ReNEW. It also counts Aloe Environment Fund as a promoter shareholder.
The company’s accumulated losses have eroded over half of its peak net worth over the last four financial years. The promoters are putting in more money and the firm is also looking at alternative resources to tide over the tight financial status.
For Ventureast, this is the second time that the company would invest in Polygenta. In March this year, the venture capital fund said it will invest Rs 14.25 crore ($2.29 million) in Polygenta through non-convertible preference shares. Last year it was to invest Rs 11 crore to acquire 1.88 per cent stake in the company. However, this transaction did not materialise.
We are trying to get more details on why this transaction announced in late 2012 did not take place and will update the story as we get more information.
Ventureast Life Fund III is a $200 million venture capital fund which focuses on healthcare, sustainable agriculture and clean environment technology sectors. It typically seeks to invest between $5 million and $15 million in its portfolio companies. Ventureast has invested in six companies through this fund since 2010.
(Edited by Joby Puthuparampil Johnson)