BMM Cement Limited

completed

BMM Cements Limited (“BCL” or the “Company”) was incorporated in 2007. BCL has established a 0.95 million metric tons per annum (MTPA) integrated cement manufacturing unit at Gudipadu village, Yadiki Mandalam, 25 km from Tadipatri, in Anantpur district in the southern Indian state of Andhra Pradesh. The cement plant was commissioned in 2012 and currently produces Ordinary Portland Cement (OPC) grades 53 and 43 and Portland Pozzalona Cement (PPC). Due to various internal and external constraints/issues, the capacity utilization of the plant has been low since inception and the Company has been incurring lossesConsequently, the shareholders of BCL have entered in to an agreement in November 2014 to transfer the ownership of BCL to Sagar Cements Limited (“SCL”). SCL is a relatively small player in the South Indian market with a cement manufacturing capacity of 2.75 MTPA spread across two plants located at Matampally and Pedaveedu in the Nalgonda district of the state of Telangana. SCL’s turnaround plan for BCL includes (i) improving the operational efficiency of the plant through investing in (a) refurbishment of the plant, (b) in insurance spares and (c) in working capital; and (ii) restructuring the balance sheet by injecting long term capital including refinancing debt to extend maturities.. IFC proposes to part finance BCL’s turnaround plans, subject to the transfer of ownership and completion of all regulatory formalities related to the transaction.