Jain Irrigation Systems (JISL) along with Jain Farm Fresh Foods (JFFFL) today announced plans to raise equity of approximately Rs 7.92 billion (approximately USD 120 million) to accelrate the growth of the company.

The investment by funds will be managed by Mandala Capital, a fund focused exclusively on investing in agribusiness in India.

In the 1st stage, Mandala will invest Rs 3.96 billion in Jain Farm Fresh Foods (USD 60 million) within the pre-money enterprise valuation range of Rs 25 billion to 30 billion, subject to JFFFL's performance. The investor will get 14.08% or 17.13% stake in JFFFL, subject to its performance.

In 2nd stage, Mandala will invest Rs 2.85 billion (USD 43.2 million) at Rs 80 a share through compulsorily convertible debentures at 5% annual coupon.

In the final stage, the promoters will invest Rs 1.11 billion (USD 16.8 million) at Rs 80 a share through warrants structure.

With the raised funds, the company will accelerate JISL's balance sheet strengthening and also provide growth capital for JFFFL, the newly formed, wholly owned subsidiary of JISL under which its global food business will now be organized.

Anil Jain, managing director of JISL said, "We are delighted to be putting together such a large equity investment from Mandala even in challenging global market conditions. The terms and structure of this transaction will enable JISL to continue with balance sheet strengthening and sustainable growth. The transaction demonstrates, for the first time, the high intrinsicvalue and growth potential of our newly formed global foods vertical, JFFFL."

Shares of the company declined Rs 1.35, or 3.14%, to trade at Rs 41.60. The total volume of shares traded was 7,272 at the BSE (2.21 p.m., Friday).