WestBridge invests $28m in India's CEAT
WestBridge Capital Partners has invested INR1.8 billion ($28 million) for a 3.5% stake in India-listed tire maker CEAT.
Public market data shows WestBridge bought 1.43 million shares at INR1,290.35 apiece via its investment vehicle Jwalamukhi Investment Holdings from Kotak Mahindra Bank. The purchase gives WestBridge a total holding in CEAT of 11% between Jwalamukhi and the WestBridge Crossover Fund, a 2011-vintage vehicle focused on PIPE deals and positioned as an evergreen fund without a specific investment cycle.
CEAT is the flagship company of the RPG Group, an Indian industrial conglomerate whose other businesses include Apax Partners-backed IT software developer Zensar Technologies. The company makes tires for trucks, buses, light commercial vehicles, forklifts, tractors, cars and motorcycles. It sells to a number of Indian corporate players, along with dealers in the after-sales market.
In addition to its Indian business, CEAT has a significant presence abroad, exporting tires for trucks, buses and light commercial vehicles to global customers. Recently it also began selling passenger vehicle tires in Italy with a view to expanding across the European market. According to the company’s most recent annual report, exports accounted for 13% of sales for the year ended March 2016. Overall revenue for the period came to INR55.4 billion, a slight drop from INR55.7 billion the year before. Profit rose from INR4.43 billion to INR6.36 billion.
WestBridge first invested in CEAT in 2014 via Jwalamukhi and raised the vehicle’s holding to 4.5% over several tranches. The following year it bought another 3.5% stake from Kotak Mahindra Bank through WestBridge Crossover Fund.
WestBridge was founded in 2000, raised two funds and then merged with Sequoia Capital. After going independent again in 2011 the firm raised the Crossover Fund, which initially closed at $525 million in August of that year. The vehicle later raised an additional $325 million in 2014 and $575 million in 2015.
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