Announcement of IFC Investment in Jayshree Chemicals Limited, India on December 29, 1966

INTERNATIONAL FINANCE CORPORATION 1818 H STFfEET, N.W., WASHINGTON 25. 0. C. TELEPHONE: EXECUTIVE3-6360 IFC Press Release No. 66/19 Subject: IFC Investment in· Jayshree For Release AM Newspapers Chemicals Limited., India Thursday, December 2 9, 1966 The International Finance Corporation (IFC)., an affiliate of' the World Bank, has become a shareholder in Jayshree Chemicals Limited as part of' a $1,lSS,OOO commitment to canplete the financing for a new caustic soda plant in eastern India. 'lhe Jayshree plant is being established at Ganjam on the coast or the State of Orissa., about 300 miles southwest of Calcutta., and involves a total invest,. mentor about 48 m1llion rupees (~6.4 million)., including provision for marginal working capital. 'I'he operation will provide employment for about 27S persons in an area where there is little industrial. activity at present and is expected to • stimulate local procluction of salt, the main ra,-1 material for making caustic soda. Sponsor of the project is the Bangur Group., a leading Indian industrial group with interests in jute., textiles., paper., cement and other enterprises. Industrial demand for caustic soda in India has been rising at an average annual rate of about 15 per cent in recent years and has for some time exceeded domestic production. 'lhe Jayshree plant will have ~~ annual capacity of 16.,SOO tons and will supply caustic soda to such industries as pulp and paper., textiles and aluminum. An essential byproduct or the operation will be chlorine, used as a bleaching agent in the production or textiles and pulp and paper. Equipment foJ':' the Jayshrea project is being supplied by Krebs et Cie. S.A., a prominent French designer and manufacturer of chemical plant. IFC's commitment consists of a subscription to ordinary shares or Rs. 787~SCY., • (about $10S, 000) ; a 10-year loari ot $840., 000., bearing a bank guara11tee; and the  • - 2 - purchase ot $210,000 principal amount or convertib,le debentures, denominated in U. s. dollars. Share capita1. of Jayshree, made up or both ordinary and preferred shares, has been subscribed by the Bangur Group and by several Indian financial institutions, together with individual investors., to whom a public ottering was made in early 1966. Long-term loan capital bas been provided· by the State Bank or India, the Industrial Finance Corporation ot India (IFCI)., the Bangur Group and through French suppliers' credits, while a rupee convertible debenture issue has been taken up by IFCI, the Industrial Credit and Investment Corporation or India and the Industrial Development Bank ot India. IFC has now made a total or $11.9 million in camnitments to Indian enter- prises, to finance production of textile machinery, alloy steels., ball bearings and PUii>&, among other items. Included in this total is a commitment or $1.2 million made in 1964 to Fort Gloster Indllstries., also controlled by the Bangur • Group, to help the company expand its electric cable manufacturing facilities • •