Cholamandalam Investment Board Approves Raising of Rs. 500 Cr

Board of Directors approves raising of Rs. 500 crs through issue of Compulsorily Convertible Preference Shares

 The Board of Directors Cholamandalam Investment and Finance Company Limited at their meeting held on 26 July 2014 considered and approved an issue of 50,000,000 Compulsorily Convertible Preference Shares ("CCPS") of Rs 100 each aggregating to Rs. 500 Crore (Rupees 5 billion only) on a preferential basis as permitted by SEBI (ICDR) Regulations to investors as a preferential issue in terms of Chapter VII of the SEBI (ICDR) Regulations. 

This capital infusion will help the Company to meet the business growth and augment the Tier 1 capital adequacy ratio (CAR).

The CCPS will bear a dividend coupon of 1% per annum payable from the date of allotment of CCPS till the date of conversion into equity shares. The CCPS shall be converted into equity shares at the expiry of 12 months from the date of allotment or earlier at the discretion of the Board. 

The entire CCPS issue will be subscribed by funds advised by the global private equity firm Apax Partners ("Apax Funds").  

The proposed preferential issue is subject to the approval of the members of the Company and any other applicable regulatory approvals.

Commenting on the occasion, Mr. S Vellayan, Managing Director, Cholamandalam said “We are glad to have the opportunity to work with Apax a leading global PE firm in this round of capital infusion”

Commenting on the occasion, Mr. Shashank Singh, Managing Director and Head of Apax’s India office said, “Apax Funds are delighted and proud to be partnering with the Murugappa Group, one of India’s leading and most-respected groups.  We believe in the long term secular growth runway of Indian retail financial services and Cholamandalam is well positioned in this space, with an outstanding management team and exposure to attractive lending segments.”  

Advisors

Axis Capital Limited was the exclusive transaction advisor to Cholamandalam for this fund rise. 

The M&A advisor to Apax Funds was Kotak Mahindra Capital Company. Khaitan & Co and Kirkland & Ellis LLP were legal counsel for Apax Funds on this transaction.

For media Contact

Nishanth

M: 98840 70861
Konnections

nishanth@konnections.co.in

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