Parag Milk Foods to set major fundraise in motion with Sixth Sense Ventures, World Bank’s IFC

The company plans to raise a total of Rs 316 crore. IFC and Sixth Sense Venture Advisors, will invest Rs 155 crore and Rs 50 crore, respectively

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Parag Milk Foods has announced that it plans to raise a total of Rs 316 crore by preferential allotment of equity shares, foreign currency convertible bonds (FCCBs) and other instruments from IFC and Sixth Sense Venture Advisors and promoters. IFC and Sixth Sense Venture Advisors will invest Rs 155 crore and Rs 50 crore, respectively. Promoter and family will further invest Rs 111 crore, maintaining the promoter stake at 46 per cent, Parag Milk Foods mentioned in a regulatory filing.

Parag Milk Foods said this fundraise is subject to shareholder’s approval in the ensuing extraordinary general meeting scheduled on April 26, 2021, as well as regulatory approvals. International Finance Corporation (IFC) is proposing an investment of up to Rs 155 crore by way of subscription to the preferential issue of equity shares and subscription of FCCBs in addition to a proposed subscription to NCDs of Rs 150 crore committed in December, said Parag Milk Foods.

Sixth Sense Venture Advisors has proposed an investment of Rs 50 crore by way of preferential allotment of 45,04,505 equity shares of face value Rs 10 each at a price of Rs 111 each, the company said. As per the regulatory filing, the promoters will invest Rs 111 crore that includes a preferential allotment of 50, 00,000 convertible share warrants in the name of Devendra Prakash Shah along with 50, 00,000 to Netra Pritam Shah, convertible into equity shares with a face value of Rs 10 each fully paid up, on a preferential basis, at a price of Rs 111.

Devendra Shah, Chairman, Parag Milk Foods said, “The funds that will be raised through FCCB will be utilised for meeting our Capex requirements over the next two years and would free up our cash flows during that period”.

 

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