Sagar Cements Ltd approves Preferential Allotment of Equity Shares to Premji Invest

The Board of Directors of Sagar Cements in their meeting held today has approved the issuance of 1,32,07,548 equity shares of face value of Rs. 2 each at an issue price of Rs.265/- per share on a preferential basis, to PI Opportunities Fund ("PIOF"), an affiliate of Premji Invest, an investment arm of Azim Premji's endowment and philanthropic initiatives, which has been active in investing in the Indian capital market for over fifteen years, with a large investment corpus. This investment is reflective of the quality and scale of business created by Sagar Cements over the past four decades. The Company today ranks amongst India's lowest cost cement producers of high-quality cement with the current capacity of 8.25 MTPA tones.

Although its core market is the Southern region, Sagar Cements has also expanded its market presence in East and Central India through its recent acquisitions.

The proceeds of current equity issue will be largely utilized towards meeting the organic and inorganic expansion plans of the Company along with funding its general corporate purposes.

Commenting on the development, Mr. S Sreekanth Reddy, Joint Managing Director, Sagar Cements said "We are delighted to partner with Premji Invest and look forward to their inputs towards strengthening our processes and systems and enhancing value for all our stakeholders."

Added Rajesh Ramaiah, Partner at Premji Invest "Sagar Cements is a niche cement player with demonstrated cost leadership and a growing position in its focus markets in southern part of India. It has had a remarkable journey since inception and with expansion outside southern India through organic and inorganic plans, it is well positioned to become a pan India player. He further said that they look forward to working together and helping the Company achieve its growth objectives and becoming a pan India brand with best-in-class governance processes."

Post the investment, PIOF will own 10.10% of the Company and will have a nominee on the Board. Promoters' ownership in the Company, after the allotment will be at 45.20% (from 50.28%).

PIOF will work with the Promoters and the Company in setting up a best-in-class governance process, through appointment of advisors / independent directors as appropriate, in consultation with other stakeholders in an endeavour to drive value creation for all the shareholders.

o3 Capital acted as the exclusive Financial Advisor to the Company and Samvad Partners acted as the Legal Advisor to the Company on this transaction.

Source : Equity Bulls

Keywords

SagarCements PreferentialAllotment FundRaising PremjiInvest PIOpportunitiesFund