Citigroup Venture Capital International (CVCI) appears to have pressed the final exit button from its three-and-half-year-old investment in edible oil company KS Oils. It sold almost 90% of its 4.95% holding in a bulk deal for Rs 93 crore at Rs 50 a piece earlier this week.
The private equity firm had committed investment of Rs 90 crore in late 2006 through a mix of direct equity issue at a price of Rs 180 a share for Rs 59.24 crore and the rest through subscription to warrants convertible into equity at same price. After stock split, its average cost of purchase is pegged at Rs 18 per share, translating into 3x returns on its three and half year old investment.
CVCI had been making part exits over the last two years. Last year it sold nearly 5% netting a similar amount.
KS Oils is one of the largest manufacturer of mustard oil in India. The company, owned by the Garg family which is into sixth generation in the commodities market, had also attracted a number of other private equity firms after CVCI invested in it. KS Oils also counts
amongst its investors Baring Private Equity Asia (5%) and New Silk Route (9.8%). KS Oils said earlier this year that it plans to invest Rs 220 crore this fiscal to expand its business in both domestic and overseas markets.
CVCI, which has one of the largest private equity portfolios in India, has been selling its stake in various listed companies since last year. The firm has made slew of exits like HT Media, Lupin, Techno Electric among others. Its portfolio companies like You Broadband and Ind-Barath Power have also filed for their listings.
CVCI recently exited most of its investment in polyester chips maker JBF Industries by selling a 14.3% stake in the open markets for Rs 120 crore. JBF also bought back two-thirds of total convertible holdings of CVCI in the company’s Singapore unit for $60 million.