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BCCL Sells Chunk Of Shares In Provogue

By Pallavi S

  • 24 Jun 2010

BCCL Sells Chunk Of Shares In Provogue

Media firm Bennett Coleman & Company Ltd that picks minority stake in companies through ad-for-equity deals appears to be on the exit mode from fashion apparel retailer Provogue. BCCL has sold close to two-thirds of its 1.74% stake in Provogue for Rs 6.3 crore ($1.3 million).

This works out to be the second round of exit by BCCL, a pre IPO investor in the company. It had invested Rs 7 crore in February 2005, just prior to the public float. BCCL sold almost half of its holding in the September-December’07 period netting a neat pile of around Rs 20 crore or 6x net returns on the cost of acquisition in less than three years.

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However, with the market crash thereafter, the unrealised gain came down. BCCL acquired more shares(apparently through market purchases for an estimated Rs 2.5 crore) early last year when valuations hit a bottom, but that pushed up its average cost of purchase a bit.

It held around 1.74% stake with an average cost of purchase pegged at about Rs 33 a piece (Rs 28 a piece before the additional stake buy). The investor sold almost 1% stake in the open market at a price of Rs 53.4 with 60% returns this week.

Provogue is also backed by other investors such as Rakesh Jhunjhunwala, Acacia Partners and New Vernon. Jhunjhunwala is also a pre IPO investor who remains with the firm.

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