Detergent major company Nirma on Thursday raised Rs. 4,000 crore debt to buy the cement business of French firm LafargeHolcim India. This is the largest rupee bond sale for a leveraged buyout.
Nirma has raised the amount for the deal from Nirchem, a special purpose vehicle created by the company for the buyout.
"The Rs. 4,000 crore five-year bond sale by Nirma offers a yield of 8.68 percent and was oversubscribed 1.5 times. This is the largest rupee bond sale for a leveraged acquisition as also the largest AA-rated debt instrument," an investment banker was quoted as saying by the Press Trust of India.
The banker added that the issue had been closed successfully and will be listed on the exchanges. The Ahmedabad-based company has appointed Barclays, Credit Suisse and IDFC to manage the issue.
In July, Swiss cement major LafargeHolcim had announced that it had signed an agreement with Nirma to sell all of its assets to the Indian firm for $1.4 billion (about Rs. 9,400 crore) on getting clearance from the Competition Commission of India (CCI).
During the time Lafarge had said it would use proceeds from the sale to reduce its debt.
LafargeHolcim's India will continue to have a presence through its subsidiaries, ACC Ltd. and Ambuja Cements Ltd, which have a combined cement capacity of over 60 million tonnes.
The diversified Nirma group of companies has interests in soaps, detergents, salt, soda ash, caustic soda, cement and packaging, among others. The India assets sale to Nirma is part of LafargeHolcim's larger divestment programme for the year, which comprises three cement plants and two grinding stations with a total capacity of around 11 million tonnes per annum.