City-based Tega Industries on Wednesday announced that the company, in consortium with funds managed by affiliates of global alternative assets manager Apollo Funds, has entered into a term sheet to acquire Molycop from an affiliate of American Industrial Partners (AIP) at an enterprise value of $1.5 billion.
Tega Industries is engaged in the business of mineral beneficiation, mining, and bulk solid handling. Molycop is a global supplier of grinding media to the mining industry with applications critical to mineral extraction and processing of multiple minerals, specifically copper and gold.
The two entities —Tega Industries and Molycop together clocked $1.73 billion (₹15,207 crore) in revenue and $217 million (₹1,906 crore) in EBITDA (according to the latest audited financial statements).
In a stock exchange filing on Wednesday, Tega Industries said that the consortium shall acquire, directly or indirectly, 100 per cent of the equity interests of AIP, through a special purpose vehicle where Tega will hold a 77 per cent equity stake and Apollo Funds will hold a 23 per cent equity stake.
“With this strategic acquisition, and in partnership with Apollo Funds, we will accelerate innovation, greatly expand market reach and create significant value for our customers,” said Mehul Mohanka, MD and group CEO of Tega Industries.
“For Apollo, this is a great example of pairing strategic equity and debt within a flexible, hybrid solution, and we look forward to partnering with the talented management team of Molycop and Tega to accelerate growth and drive value creation,” said Gaurav Pant, partner, Apollo.
“We believe the business will be in excellent hands and well-positioned to continue creating value under Tega’s leadership,” said Kim Marvin, general partner, AIP.
“Our shared values and complementing strengths will help us accelerate our strategy, innovate better, and serve customers across the globe more effectively,” said Jim Anderson, CEO of Molycop.
Tega said that the company’s priority in the first eight quarters post-transaction closure will be operational and business integration. The parties currently expect the transaction to close by December 31, 2025, subject to receipt of the required regulatory approvals.
Its board is set to meet on September 13 to consider a proposal to raise funds through a private placement, preferential allotment, qualified institutions placement or through any other permissible mode.