Cement maker Nuvoco Vistas seeks private loan for Vadraj takeover

Nuvoco Vistas Corporation Ltd., among India’s largest cement makers, is seeking a private loan of about $140 million to back its purchase of rival, Vadraj Cement Ltd., according to people familiar with the matter.

The facility will carry a tenor of between four to five years, the people said, who asked not to be identified discussing private matters. The borrower is also in talks with alternative asset firms for the financing, the details of which could be subject to change as discussions are ongoing, the people added.

Nuvoco Vista didn’t respond to requests seeking comment.

Private credit in India is expanding alongside Prime Minister Narendra Modi’s infrastructure push, which has created a need for middle-market funding in everything from solar power to roads. Such investments in India totaled $9.2 billion across 163 deals last year, according to an Ernst & Young report.

Nuvoco Vista is turning to private credit because banks aren’t keen to lend to domestic merger and acquisition situations, the people said. Guidelines from the Reserve Bank of India restrict Indian banks’ ability to fund equity share purchases of local companies, except in special circumstances.

On April 3, India’s National Company Law Tribunal approved Nuvoco Vista’s takeover of Vadraj Cement for Rs 1,800 crore ($210 million), according to a company press release.