Rs 300cr Bankam Bridge Loan For Gujarat Ambuja

Bank of America (BankAm) has sanctioned Rs 300 crore as bridge loan to Gujarat Ambuja Cements Ltd (GACL) to acquire four per cent equity of the Tatas in Associated Cement Companies (ACC).

According to sources, the bank has already provided the funds to GACL for the second round of acquisition. This will take GACL's stake in ACC up to 11.2 per cent, thereby making it the second largest shareholder in ACC. Financial institutions are the largest equity holders in ACC with 22 per cent stake.

When contacted the Gujarat Ambuja Cements Ltd (GACL) executive director Anil Singhvi declined to comment on the development.

 

Shares of ACC were up 3.21 per cent and closed at Rs 126.95 on the Bombay Stock Exchange after touching a high of Rs 128.95.

Earlier, GACL has bought 7.2 per cent Tata's equity in ACC at Rs 455 crore at Rs 370 per share. The shares were bought by the newly created company Ambuja Cements India Ltd (ACIL) in which the promoters have parked 93 per cent of Modi Cements.

After transferring the stake in the newly created company, the promoters had sold 40 per cent stake to American Insurance Group International (AIG) and Government of Singapore Investment Corporation (GSIC) for $85 million. This first round of acquisition was also funded by Bank of America to the extent of Rs 400 crore sometime in December last year.

The company had prepaid around Rs 200 crore, a part of which it received by divesting 40 per cent stake in Ambuja Cements India Ltd (ACIL) for $85 million.