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Kotak Special Situations Fund, the alternative investment arm managed by Kotak Investment Advisors Ltd, will invest 550 crore in cement maker Sanghi Industries Ltd from its $1 billion fund.

The investment would be made in the form of non-convertible debentures, according to a statement by Kotak. 500 crore has been invested in the NCDs of Sanghi Industries, and the remaining 50 crore in the NCDs of a promoter-owned entity, according to the Kotak statement.

“The board of directors has inter alia approved allotment of 5,000 secured, unrated, unlisted, redeemable, non-convertible debentures totally aggregating to 500 crore on private placement basis," Sanghi Industries said in a statement to the exchanges.

With this investment, Kotak Special Situations Fund has completed 13 deals and deployed over 6,300 crore of its $1 billion fund, which it closed in August 2019. The fund focuses on special situations, credit and distressed spaces in India, and its first transaction was in January 2020. 

Sanghi Industries is the flagship company of the Ravi Sanghi Group. It is engaged in the manufacturing and distribution of cement under the brand ‘Sanghi Cement’. The company has a strong presence in Gujarat and operates in the low-cost cement producers’ segment.

On Tuesday, shares of Sanghi Industries rose 0.2% to 66.50 on BSE.

Eshwar Karra, chief executive of Kotak Investment Advisors, said, “Sanghi Industries’ performance has been under pressure owing to high energy costs. This was further exacerbated by the upcoming debt repayment availed for the expansion capex. Kotak Special Situations Fund’s infusion terms out the debt and should correct the capital structure. It also underlines how KSSF has structured a solution that addresses Sanghi Industries’ specific financial requirements."

Kotak Investment Advisors focuses on the alternative assets business. It was set up in 2005 and has since then managed in aggregate over $6.8 billion across different asset classes including real estate, private equity, and infrastructure. In November, Kotak Special Situations Fund also announced investments in Sify Infinit Spaces Ltd, a unit of Sify, worth 1,000 crore.

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