Home / Companies / Start-ups /  Zetwerk raises 100 cr debt led by Edelweiss

Mumbai: Business-to-business (B2B) manufacturing services marketplace Zetwerk has raised around 100 crore in debt capital, with a fund backed by the Edelweiss Group contributing the bulk of the financing, said two people privy to the development.

The debt was raised by issuing non-convertible debentures (NCDs) with around 83 crore garnered from Edelweiss Credit Plus Fund, which provides debt capital for early-to-mid stage private companies.

“The primary debt fundraise is part of a syndicate round participated by another fund and a few high net worth individuals (HNIs) (who contributed the rest 17 crore)," one of the persons said on the condition of anonymity. He didn’t name the second fund and the HNIs.

Perigon Consillario LLP acted as the investment banker for the transaction while Cyril Amarchand Mangaldas (CAM) was the legal advisor. Both the firms didn’t respond to queries till press time.

Queries emailed to Zetwerk remained unanswered while Edelweiss declined to comment.

Zetwerk’s move to raise debt comes ahead of a fresh equity round planned by the company over the next few months.

The people cited above said Edelweiss Group’s other funds such as Crossover Opportunities fund are in talks to take part in Zetwerk’s equity round. The size of the equity round couldn’t be ascertained.

Launched in early 2022, Edelweiss Credit Plus Fund is a category II alternative investment fund (AIF) focused on mid-market opportunities in performing credit space. It provides short-tenure capital for 1-3 years and has catered to companies, largely in the fintech space such as Cashe and Spandana Sphoorty.

The new funds will be utilized to build Zetwerk’s capital market access, make fresh acquisitions and to drive further growth of the business.

Founded in 2018 by Acharya, Srinath Ramakkrushnan, Rahul Sharma and Vishal Chaudhary, Zetwerk helps small and medium enterprises in the manufacturing sector translate their digital designs into physical products. It operates in over 25 industry segments with an aim to help customers cut costs of existing and new production parts, optimize the number of suppliers and handle high quality production faster.

Zetwerk has made a series of acquisitions over the past year. The most recent was in last November when it bought manufacturing services company Unimacts for $39 million in a cash-and-stock deal.

In June 2022, Zetwerk acquired three companies for 100 crore in a bid to strengthen its industrial verticals in the oil and gas, aerospace, defence and infrastructure component segments. Zetwerk competes with other B2B manufacturing companies such as InfraMarket.com, Udaan, Moglix and OfBusiness with increasing focus on Make in India. Such firms are capitalizing on growing local manufacturing which has scaled up the overall business of smaller and medium sector enterprises (SMEs). As per a recent report by Matrix Partners, funding for B2B startups in India has grown by 46% annually over the last eight years, and since 2015, Indian B2B startups have raised more $8.5 billion from investors.

Beena Parmar
Been Parmar is a financial journalist based in Mumbai. She has reported on the banking and finance sector for over 10 years. She now writes on the alternative investment ecosystem from India - private equity, venture capital and especially startups. She loves to read about politics, society and humane stories.
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