The Dhunseri group-promoted South Asian Petrochem Ltd is entering the market with its maiden public issue of equity shares and also fully convertible debentures (FCDs) to raise Rs 180 crore.
The issue is to part finance the company's 100 per cent export oriented unit (EOU) project to manufacture 140,000 tpa bottle grade PTE resins at Haldia, West Bengal.
Of the Rs 180 crore, promoters, co-promoters and the WBIDC will be contributing Rs 105.50 crore and the net offer to public is Rs 74.50 crore. The public float comprises Rs 50 lakh equity shares of Rs 10 each for cash at par and Rs 69.50 lakh FCDs of Rs 100 each for cash at par.
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Post issue, Dhanuka & associates will hold 60.5 per cent with Zimmer AG and Arabela holding 11.6 per cent. WBIDC will have 4.8 per cent in the project.
The cost of the project, estimated at Rs 450 crore, is being funded through term loans / non-convertible debentures (NCDs) to the extent of Rs 260 crore and equity / FCDs of Rs 190 crore. The entire term loan has been tied up with IDBI, IFCI and Exim Bank.
LIC,GIC and United Insurance Company have agreed to subscribe to the FCD to the extent of Rs 25 crore and the remaining Rs 44.50 crore and the entire equity issue has been fully underwritten.
The FCDs carry 14 per cent interest rate, payable half-yearly and are compulsorily convertible into equity shares at par at the end of 24 months. The payment of interest on the FCDs has been secured through an escrow mechanism with Bank of Baroda and shall be made out of fixed deposits kept with the bank.