“The 18-month NCDs were increased by 7.30%, while the 24-month NCDs were increased by 7.35%. These funds were raised to finance the acquisition announced in December. The rest of the money will be arranged by the company through internal accruals,” said a person familiar with the NCD issues.
Axis Bank was the sole arranger for these deals that were priced earlier this week.
The NCDs were largely subscribed by mutual funds, namely ICICI Prudential, DSP Mutual Fund, Mirae Asset Management and Aditya Birla Mutual Fund, among others. Emails sent to the individual mutual funds, Axis Bank and SPRL remained unanswered till the publication of this report.
Vertical mergers and acquisitions
This acquisition was valued at approximately Rs 1,670 crore and enabled SPRL to expand beyond traditional powertrain components into the fast-growing segment of automotive interiors.
On December 5, SPRL had announced the acquisition of Antolin Lighting India Private Limited (ALIPL), Grupo Antolin India Private Limited (GAIPL) and Grupo Antolin Chakan Private Limited (GACPL), giving it access to a portfolio that includes access to modular headliners, sun visors, door panels, center floor consoles, pillar trims, etc., the company had said in a press release.
Earlier this month, India Ratings and Research (Ind-Ra) upgraded the company’s ratings and proposed non-convertible debentures (NCDs) from ‘IND AA’ to ‘IND AA+’. “Ind-Ra expects the acquisitions to strengthen SPRL’s business profile by increasing its diversification into the engine-agnostic segments.
The company’s current products, including pistons, rings and valves, are engine components exposed to the risk of an EV transition; thus, these acquisitions are likely to help the company diversify its revenue base. The acquisitions will also increase the overall size of the consolidated entity’s operations,” the rating agency said.
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