The country’s largest lender State Bank of India (SBI) has acquired a minority stake in JSW Cement Ltd at an investment of Rs 100 crore. SBI has acquired compulsorily convertible preference shares that will be converted to equity shares on terms linked to JSW Cement’s future business performance.
The valuation will be fixed at the time of the proposed initial public offering (IPO) of the company.
JSW Cement added that the capital infusion will support its capacity expansion to 25 million tonnes (mt) from 14mt.
Earlier this year, two private equity players — Apollo Global Management Inc through its investment entity in Singapore and Synergy Metals Investments Holding — invested in the company.
In this case also JSW Cement issued compulsorily convertible preference shares to the company.
“We are one of the fastest growing cement companies and the largest green cement company in India,” Parth Jindal, managing director, JSW Cement said.
“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.’’
JSW Cement is part of diversified $13 billion JSW Group. It has manufacturing units at Vijayanagar in Karnataka, Nandyal in Andhra Pradesh, Salboni in West Bengal, Jajpur in Odisha and Dolvi in Maharashtra.
The company’s subsidiary, Shiva Cement, is investing over Rs 1,500 crore in a 1.36 million tonne (mt) clinker unit to be set up in Sundergarh district of Odisha. The project includes the setting up of a one million tonne grinding unit.
JSW Cement is present across the entire value-chain of building materials comprising cement, concrete & construction chemicals.
“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,’’ Narinder Singh Kahlon, director finance of JSW Cement said.
