IFC likely to acquire upto 12% stake in Jay Shree Tea and Industries

Jay Shree Tea & Industries is in talks with IFC to raise as much as Rs 55-60 crore according to sources close to the deal. IFC may acquire a 10-12% stake in the tea producer and the deal is likely to priced at Rs 200-220 per share – a 25% premium to the current market price. The share sale will happen through a fresh issuance of equity shares. Jay Shree Tea had secured FIPB approval two weeks ago.

The company intends to deploy the funds for acquisition opportunities in Rwanda and Uganda. On being contacted, MD of Jay Shree Tea confirmed that IFC was indeed one of the institutions that was interested. “We are in talks with IFC along with several other investors as well”. He however declined to comment on the terms of the deal being negotiated with the potential investors.

The deal is expected to close over the next two months. Jay Shree Tea had previously mentioned that they were looking to raise upto a maximum of Rs 100 cr via the QIP route.

Analysts expect tea prices to rise 10-15% over the next six months given the supply shortage in the industry.