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Madhucon arm to raise Rs 300 crore via NCDs
The amount raised will be used in the company’s road, power and coal mine projects.
Updated : Mar 30, 2018, 03:10 AM IST
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Madhucon Infra, a subsidiary of Madhucon Projects, is close to raising Rs 300 crore through non-convertible debentures, according to persons familiar with the development.
The amount raised will be used in the company’s road, power and coal mine projects.
“Madhucon Infra is almost through with the fundraising. The NCDs will have a tenure of 3 years and the coupon rate is being finalised. The issue should be completed in a few days,” said a source.
S Vaikunthanathan, director, finance, Madhucon Projects, when contacted, declined comment.
The source said that the issue is in line with the company’s plans to raise funds before going public next year. Madhucon Projects had in September decided to bundle all its development projects and list that entity by last February and raise Rs 500-600 crore.
But the issue had to be put off for a year because as per the Securities and Exchange Board of India norms, a company has to wait for a year after re-pledging of shares before it can file the draft red herring prospectus.
DNA broke both the stories.
Madhucon Projects earlier this month completed the transfer of the pledged shares it held in its special purpose vehicles to Madhucon Infra, which were then re-pledged with banks.
With this, all of Madhucon’s current and future build-operate-transfer projects will be under Madhucon Infra while Madhucon Projects will handle engineering, procurement & construction projects. The latter has an order backlog of Rs 4,700 crore.
Because of the delay in going public, Vaikunthanathan earlier told DNA that Madhucon Infra was looking at pre-IPO fundraising. Private equity was one of the options considered.
“But with the issue of NCDs, there will be no pre-IPO placement. The company will repay the debt through the IPO proceeds,” the source said.
Madhucon Projects has two operational highways, two that will begin tolling shortly and one for which funds are yet to be tied up. The company is also developing a 1,920 mw thermal power project in Krishnapatnam and a coal mine in Indonesia.
