Ahmedabad-based detergent major Nirma has raised Rs 4,000-crore debt to buy the cement business of French major Lafarge India.
The deal had been agreed upon in July. “The Rs 4,000-crore five-year bond sale by Nirma offers a yield of 8.68 per cent, 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,” investment banking sources have been quoted as saying in news reports.
The money for funding the deal was raised by Nirchem, a Special Purpose Vehicle created by Nirma for the buyout. The company appointed Barclays, Credit Suisse and IDFC for managing the issue. The issue had been closed successfully and would be listed on the exchanges.
In July this year, Swiss cement giant Lafarge-Holcim had announced that it was entering an agreement to sell its assets in Lafarge India to Nirma for $1.4 billion or Rs 9,400 crore to get clearance from the fair trade regulator Competition Commission of India (CCI) for the deal as part of the global merger.
The agreement, part of the building material major’s 3.5 billion Swiss franc (about $3.6 billion) divestment plan, is crucial for approval from CCI for the multibillion dollar global merger between Lafarge and Holcim that was announced last year.