Mumbai-based Accentia Technologies Ltd has received its board’s approval to issue shares and warrants to its promoters and also to the US-based private equity firm Berggruen Holdings and the hedge fund Cycladic Capital LLP, the company has disclosed in a statement to the Bombay Stock Exchange.
The company will issue 24,25,000 equity shares and 5,59,615 warrants to the investors. Although the issue price has not been disclosed yet, Accentia will be able to raise around Rs 17 crore ($3.5 million) at the current market price.
Berggruen Holdings is an existing investor in the company and holds 12.67 per cent stake as of December 30, 2011. It had originally invested in Q4 of 2007, when valuations were close to peaking out. Although the stock price did move up in 2010, the PE firm stuck around and is now sitting on unbooked losses of over 75 per cent, according to VCCircle estimates.
At mid-day trades on Tuesday, shares of Accentia were quoting at Rs 55 a unit, down 1 per cent in a strong Mumbai market.
Last November, Accentia Technologies received its board’s approval to raise funds up to $10 million (Rs 52 crore).
Promoted by Pradeep Viswambharan, Accentia offers medical coding, medical billing & collections, insurance claim processing, cash applications & client services, and medical transcription services, as well as application development and application customisation services.
The company operates across 14 global locations such as Mumbai, Bangalore and New Jersey. It currently employs over 3,900 HRCM professionals including 750-plus people from the Philippines, 450 from the USA and independent contractors from various parts of India. Most of the Indian locations serve as quality control centres.
Berggruen Holdings, a private equity and venture capital firm investing in startups, direct private equity and public market securities, primarily focuses on the USA and Greater Europe, but also has investments in emerging markets like Asia. It typically invests up to $200 million of equity in a single transaction.
Besides Accentia, it has invested in a string of realty projects in India, spread across Mysore, Hyderabad, Coimbatore, Mohali and Vishakhapatnam. In addition, it has funded Berggruen Car Rentals Pvt Ltd, which offers drive and self-drive facilities for business and personal travel and currently operates in 18 cities. Three years ago, Berggruen Holdings also teamed up with Cycladic Capital to invest in construction equipment service provider.