IFC to pick stake in Jain Irrigation

Jain Irrigation Board today approved allotment of upto 2mn Equity Shares of Rs 10 each to International Finance Corporation, Washington (IFC) on a preferential allotment basis at a price to be arrived at on the basis of SEBI (DIP) Guidelines, 2000. Investment is subject to necessary approvals. These funds are going to be used to strengthen balance sheet and for regular growth capital expenditure by the Company.

The Company has experienced a steady growth in its MIS / SIS, piping and food businesses in FY 09 also. With increased allocations to the water and agriculture sectors by Government, the Company is poised to maintain its growth rate in the foreseeable future. IFC has already lent to the Company long term funds of $ 30 mn in the last 24 months at attractive rates and will lend another $30 mn in 2 tranches for meeting the capital expenditure requirements. Substantial part of the proposed funds is to be used by the Company in enhancing production capacities of Micro Irrigation division.

The Company has convened its Shareholders meeting to seek approval for its proposal of preferential allotment to the IEC on March 26, 2009 at its registered office. The proposed shares would be approx 2.69% of the fully diluted Equity after the proposed issue.

Shri. Anil Jain, Managing Director of the Company said after the meeting," This equity infusion will strengthen the Balance Sheet of the Company. IFC and Company share common development goals in Water conservation and rural development. IFC as a shareholder can play a proactive role in water and agri infrastructure sectors business for the Company all over the world. This $45 mn fund raising will also ensure completion of fund requirement for entire capex needs of next year".

International Finance Corporation (IFC) is a member of the World Bank Group (www.ifc.org) The headquarters of IFC is at Washington, USA. lFC fosters sustainable economic growth in developing countries by financing private sector investment, mobilizing capital in the international financial markets, and providing advisory services to businesses and governments.

IFC helps Companies and financial institutions in emerging markets create jobs, generate tax revenues, improve corporate governance and environmental performance, and contribute to their local communities. The goal is to improve lives, especially for the people who most need the benefits of growth. IFC invests in enterprises majority-owned by the private sector throughout most developing countries in the world. For all new investments, IFC articulates the expected impact on sustainable development, and, as the projects mature, IEC assesses the quality of the development benefits realized.

Source : Equity Bulls

Keywords