dbs bank: DBS will anchor PCBL’s Rs 700-crore issue to finance Aquapharm buy

Mumbai: PCBL Ltd, formerly known as Philips Carbon Black Ltd, is raising funds from DBS Bank to part-finance its proposed acquisition of Aquapharm Chemicals, said people with knowledge of the matter. The Singapore-based bank has committed Rs 210 crore and will be the anchor investor in PCBL’s Rs 700 crore proposed bond issue, the people cited above said.

Stock exchange-listed PCBL Ltd announced the acquisition of Aquapharm Chemicals Pvt Ltd last November for Rs 3,800 crore. It informed the exchanges that the acquisition would be done through a wholly owned subsidiary company, Advaya Chemicals Industries Ltd, which was incorporated on January 11.

Sanjiv Goenka-promoted PCBL Ltd has proposed to raise Rs 700 crore bonds for five-year, offering 8.75% payable annually. The bonds will open for subscription for qualified institutional investors later this week. The proceeds from the bonds will be used to subscribe to the optionally convertible debentures to be issued by Advaya Chemicals Industries Ltd.

DBS Bank declined to comment. PBCL had informed the stock exchanges on January 15 that its board has approved a proposal to raise Rs 700 crore bonds.

While announcing the acquisition last November, PCBL had stated that the acquisition will be financed through a mix of internal accruals and external funds raised by the company or its associates.

In a rating report on PCBL dated January 11, Crisil stated that PCBL’s “liquidity is expected to moderate due to its utilisation for funding part of the acquisition. Nevertheless, the company is expected to maintain sufficient liquidity.”