Private equity funds like ADM Capital and ClearWater Capital are in talks with the Saurashtra Cement (SCL) management to pick up a minority stake in the company. The board of directors of SCL will meet on January 14 to consider the equity sale.
Sources said: "Many foreign funds have shown keen interest to pick up equity in SCL. We are in talks with them. The SCL board will meet on January 14 to consider the sale." However, they were reluctant to divulge the names of the funds.
But sources close to the development said that ADM Capital and ClearWater are in race for the stake. Last year, ADM Capital had invested $90m in India Cements. Earlier, the Portugal-based Cimpor had also shown interest to buy into SCL.
Last December, FIs had approved SCL’s CDR package, including partial remission of interest and other charges, reduction in interest rates, rescheduling of repayments, and option to lenders for partial conversion of debt into equity of the company.
SCL is the flagship company of the Mehta group. Currently, banks and FIs hold 33.88% stake in the company, while Rajkot Nagarik Sahakari Bank alone holds 31% stake in it. Promoters’ holding in the company is around 37%. The public holds around 9% in SCL.
The company has a production capacity of 1.2Mta.