Darby's Second Asia Mezzanine Fund makes Investment in Escorts Construction Equipment

Escorts Ltd has announced that Darby Overseas Investments Ltd ("Darby"), the private equity arm of Franklin Templeton Investments and a leading provider of private equity and mezzanine capital in emerging markets has committed an investment of Rs 750 million through an affiliate of its Darby Asia Mezzanine Fund II ("DAMF II") in Escorts Construction Equipment Ltd ("ECEL"), the wholly owned subsidiary of the Company and a leading manufacturer of construction and material handling equipment.

This investment by Darby provides ECEL with a strong capital base to fund its ambitious expansion plans and to meet the fast widening supply-demand gap. Ramping up operations, ECEL is setting up a state-of-the-art manufacturing facility spread over 15 acres land at Ballabhgarh in Haryana. The new facility, the land for which has already been acquired, shall be used for enlarging its product range in existing and newer domain.

Mr. Rajan Nanda, Chairman of the Company, said of the investment: "Mezzanine finance is an attractive source of long-term capital for us as we pursue our plans for growth and an increased share of the overall market. We are very pleased to take advantage of Darby's broad experience in mezzanine financing for Companies such as ours. With an established range of equipment to cater to the demand consequent to the spectacular boom in the construction and real estate industry and with a new range of products in the pipeline, we are today aptly poised at a very significant growth opportunity of the decade."

Source : Equity Bulls

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