The deal involves three separate tranches – an operating company-level debt of around ₹3,300 crore, a ₹3,000-crore convertible instrument at holdco, and about ₹3,000 crore loan against shares at the promoter level.
The operating company debt of ₹3,300 crore is being raised through a syndicate of foreign lenders, including SMBC, MUFG, Mizuho, Barclays, JPMorgan and DBS, sources said. The loan is priced at 10% plus withholding tax, they said.
Another ₹3,000 crore is being raised via a loan against shares from domestic mutual funds, including Kotak Mutual Fund structured at an interest rate of around 8.5%, said one of the people cited above. This tranche is backed by the shares of a listed group company, helping bridge the funding requirement at the promoter level. An Additional fundraise of ₹3,000 crore is through convertibles at the holding company level from private credit funds.
Spokespersons of JSW, MUFG, Kotak and JP Morgan did not respond to ET’s queries until the publication of this report, while SMBC, Mizuho, Barclays and DBS could not be immediately reached for their respective comments.
JSW Paints & Holdco
The operating company debt is being raised by JSW Paints, while the convertibles are at the JSW Group level.
The equity portion is raised by the promoter group.
Bloomberg on June 27 had reported that JSW is looking to raise ₹4,000-crore debt to fund the acquisition through foreign banks and private credit funds.
Earlier in May, JSW Infrastructure‘s promoters, specifically the Sajjan Jindal Family Trust, had raised ₹1,210 crore by selling a 2% stake in the company to comply with Sebi’s minimum public shareholding (MPS) norms, which could also help in funding this transaction, another source said.
On June 27, Sajjan Jindal’s JSW Paints had announced a ₹12,915-crore deal to acquire Akzo Nobel India, with the aim to become India’s fourth-largest paint company.
