Clearwater Capital Partners , a New York-based special situation private equity firm, is eyeing majority stake in Vadodara-based Sayaji Hotels Ltd after it unveiled an open offer to acquire 20% stake in the mid-market hospitality chain.
Clearwater currently owns 8.48% stake in Sayaji. On Thursday, DNA reoported that Clearwater was converting Sayaji’s foreign currency convertible bonds (FCCBs), which it subscribed in 2006, into equity at Rs 75 per share. Post this, its shareholding in Sayaji would have climbed to 32.87% triggering a mandatory open offer under the SEBI takeover code. Consequently, the promoter holding will drop to 38% from around 52% now.
Clearwater's open offer period is between May 20 to June 8, and the offer is made at Rs 110 per share, Sayaji Hotels said in a stock exchange filing. Sayaji Hotels operates three properties in Vadodara, Indore and Pune. It has two subsidiaries, Barbeque Nation Hospitality and Malwa Hospitality.
Clearwater announced an open offer in accordance with the guidelines of the Securities and Exchange Board of India (SEBI) to buy up to 35,03,600 equity shares in the company. It has appointed Systematix Corporate Services Ltd as arranger to the offer.
The shares of Sayaji Hotels were traded at Rs 118.00, up by Rs 5.60 or 4.98% at 1:10 pm in the BSE today. At the prevailing prices, the company has a market capitalization of Rs 152.22 crore.
A special situation or distressed fund, Clearwater, is quite active in the India and other Asian markets with investments in auto, manufacturing and engineering space. In November last year, the firm has invested Rs 35 crore in Oricon Enterprises, a Mumbai-based manufacturer of packaging products.
In one such transaction in February this year, private equity firm Samara Capital Partners has increased its stake in BSE-listed Asian Oilfield Services Ltd to 35.9%. Samara Capital has bought the stake through a preferential allotment of shares.