International Finance Corporation, the private-sector investment arm of the World Bank, is planning to back Coimbatore-based precision automobile and industrial components maker Craftsman Automation Pvt. Ltd with debt funding of up to $30.7 million (Rs 200 crore).
The company will use the money to increase capacity, besides modernising its existing facilities through the purchase of new machinery, IFC said in a disclosure. The investment proposal will be placed before IFC’s board on 15 May.
Incorporated in 1986, Craftsman Automation is engaged in designing, developing and manufacturing precision engineered machined components. It caters to the automotive, industrial and engineering segments in India.
The company’s automotive segment contributes about 70% of its revenue while the remaining comes from industrial and engineering segments. It currently has 10 operational facilities across seven locations, including Coimbatore, Pune, Sriperumbudur, Bengaluru, Jamshedpur, Faridabad and Pithampur.
According to the disclosure, Craftsman Automation has also been planning to set up its satellite units near major auto manufacturing hubs and developing additional facilities at Faridabad, Pune, Chennai and Perundurai within the next one year.
In 2010, IFC had pumped in $10 million in Craftsman Automation. Two years later, it made a follow-on investment of $18 million along with Standard Chartered Private Equity.
According to a recent report by credit rating agency CRISIL, Standard Chartered PE and IFC hold a 15.5% and a 14.05% stake in the company, respectively.
Last month, VCCircle had reported that Craftsman Automation was also in the process of filing a draft prospectus with market regulator Securities and Exchange Board of India for an initial public offering.