Sigma Exports’ Expansion

Sigma Exports Pvt Ltd. Is in the business of Marine Exports. The company is planning is looking for an
investment of Rs.100 Crores for its next level of growth. Sigma was founded by a first generation
entrepreneur, who was controlling the entire shares of the company till few years back. Currently its
ownership is controlled by two of his sons, mother(about 30% equally) and another company which
is in the fast food retail business holds about 10%.

Sigma’s current management (which includes the promoters and few top executives) are well versed
with the marine exports business, at the same time they are not much aware of the cross industry
broad business and financial practices.

Currently almost the entire business of the firm are from the export business, with a minority
percentage from domestic market.

Sigma has good rapport with its customers, which includes leading retail chain in the US, UK and
other European countries. Its marine exports are categorised into premium and economy value
products. Premium products are exported predominantly to the West European market, whereas US
consumed both more or less equally. About 60% of its sales are to EU, 30% to US, about 6% to Far
East and 4% to Middle East.

Sigma’s procurement is at a particular time and it is done by both contract as well as in house
employees on a regular basis. This covers majority of its costs.

Sigma was planning for an expansion of its production facilities, for which they had initial discussion
with a private equity firm, Aerial Capital. They are looking for a funding of about Rs. 90-100 Crore.

Aerial Capital, a mid market Private equity firm (which does growth as well as buyout funding
depends on the situations). Aerial capital investments are sector agnostic, with prospective value
creation opportunity in a time frame of about 6-7 years. Aerial capital has been considered as a
successful firm as far as LPs are concerned. Recently Aerial has raised a new fund which was
subscribed 2 times, which made them to increase their corpus.

Aerial is headed by Venkatesh and Pirmal, who both are qualified management graduates with
about 40 years of combined experience in the industry. Aerial also has a team of professionals.

Following are the financials and the projections of SIGMA. You are appointed as an advisor for Aerial
and acting as an intermediary to act as a catalyst for the discussion and final structuring if necessary.
Aerial in terms of valuation, funding and structuring the deal for Sigma.