Axis Bank Extends Rs 700 Crore Loan To IndiaRF Fund For Ind Swift Acquisition

Axis Bank provides Rs 700 crore in funding for India Resurgence Fund's acquisition of Ind Swift Laboratories. The buyout fund, backed by Bain Capital and Piramal Enterprises, has secured senior debt from Axis Bank to facilitate the acquisition of Ind Swift Laboratories' API business for Rs 1,650 crore. Alongside the debt financing, IndiaRF Fund is utilising equity and mezzanine debt from its own funds for the transaction.

A source close to the deal mentioned, "Axis Bank is furnishing the senior debt, while IndiaRF Fund is contributing equity and mezzanine debt to enable the complete buyout of the API business." This move reflects banks' growing comfort with lending to companies that have undergone management changes, indicating a shift towards financing previously distressed entities.

The debt extended by Axis Bank is pegged at approximately three times earnings before interest, taxes, depreciation and amortisation (EBITDA), factoring in the company's Rs 256 crore EBITDA. Both Axis Bank and IndiaRF declined to comment on the matter when approached.

In September 2023, IndiaRF Fund had disclosed its intention to acquire the active pharmaceutical ingredients and contract research and manufacturing services business through Synthimed Labs, a portfolio company, for Rs 1,650 crore. The acquisition was finalised on 18 March, with debt holders being compensated.

Proceeds from the sale, amounting to Rs 800 crore, will primarily be allocated towards repaying outstanding debt worth Rs 800 crore, with the remaining funds constituting surplus for the company.