Apollo Tyres receives a nod of Warburg Pincus, a New York-based private equity firm, to get investment worth about 1,080 crores. It would be made through Warburg’s subsidiary Emerald Sage Investment Ltd by purchasing compulsorily convertible preference shares (CCPS).
The investment is subject to the approval by shareholders and regulatory authorities. Vishal Mahadevia, managing director and head of Warburg Pincus India, believes in the promising growth of Apollo tyres and showcased his trust for its strong leadership position and is exhilarated to support its journey for the next phase.
Apollo approved the issuance of 108 million CCPS worth Rs.100 each amounting 1,080 crores to Emerald Sage Investment. These CCPS carry a dividend at the rate of 6.34% per annum. They are convertible into 63 million shares of the company within a maximum period of 1.5 years from the date of their allotment.
Established in 1972, Apollo Tyres, a Gurugram-based firm, manufactures automotive bias, radial tyres and tubes across various plants located in different parts of India like Kochi, Vadodara, Pune and Chennai.
Apollo markets its products under brand names of Apollo and Vredestein and serves both OEM and replacement market in car, truck and farm vehicle segment. It has reach across hundred nations through its exclusive brand outlets. In the previous year, consolidated sales reached a mark of 12,545 crore with a net profit of Rs.399 crores.
“Their (Warburg Pincus’) investment is a strong vote of confidence in our business, management team and growth prospects. I believe the company will benefit from the backing of a large financial investor of their pedigree and our partnership will further strengthen Apollo Tyres’ board and governance,” said Onkar Singh Kanwar, chairman and managing director of Apollo Tyres.
Founded in 1966, Warburg Pincus encompassing over 190 organisations across different sectors and geographies is a global investment firm with more than $58 billion in private equity assets under management.