Zepto Founders Secure Rs 1,500 Crore Structured Debt to Enhance Indian Ownership
In a strategic move to bolster Indian ownership and pave the way for their upcoming IPO, Zepto founders Aadit Palicha and Kaivalya Vohra have initiated a significant financial maneuver. The duo is in the process of securing approximately Rs 1,500 crore through structured debt, as disclosed by sources closely familiar with the matter.
Edelweiss Alternative Asset has been identified as the key player anchoring this substantial deal. Alongside this financial giant, a consortium comprising domestic family offices and smaller credit funds is also participating in the funding arrangement. This collaboration underscores a collective effort to fortify Zepto’s financial position and broaden its investor base within the Indian market.
One of the standout features of this structured debt is the minimum interest rate it carries, which is set at a competitive 16%. However, what truly sets this financing apart is the innovative equity-linked upside component. Through this mechanism, total returns on the debt investment could potentially soar closer to an impressive 18%. This unique blend of fixed interest and equity-linked returns not only makes the deal appealing to investors but also aligns the interests of the debt providers with the long-term success of Zepto.
By opting for structured debt with an equity kicker, Zepto’s founders are not only injecting fresh capital into the business but also signaling their confidence in the company’s growth trajectory. This financial maneuver not only strengthens Zepto’s balance sheet but also underscores the founders’ commitment to fostering Indian ownership within the organization.
The decision to tap into the expertise of Edelweiss Alternative Asset, renowned for its proficiency in alternative investments, speaks volumes about the founders’ strategic acumen. By partnering with a seasoned financial player like Edelweiss, Zepto is not only gaining access to the necessary capital but also laying the groundwork for a successful IPO and sustained growth in the Indian market.
Furthermore, the participation of domestic family offices and smaller credit funds in this structured debt arrangement highlights the growing appetite for innovative financing solutions within India’s investment landscape. As Zepto gears up for its public debut, the support from these local financial entities underscores the collective belief in the company’s potential and the value it brings to the Indian market.
In conclusion, Zepto’s proactive approach to securing structured debt with an equity-linked upside exemplifies a strategic move aimed at enhancing Indian ownership and fueling the company’s growth trajectory. By forging partnerships with key financial players like Edelweiss Alternative Asset and garnering support from domestic investors, Zepto is not just raising capital but also setting the stage for a successful transition to a publicly listed entity.
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