Montecarlo Ltd’s bid to go public has hit a snag after an apparel retailer, which shares its name with the construction firm, lodged a case against the promoters.
In a stock exchange filing on Friday, Ludhiana-based Monte Carlo Fashions Ltd said it filed a civil suit at a district court in the Punjab city, following which a judge restrained Montecarlo Ltd from going ahead with its initial public offering (IPO) till July 9.
Last month, the Ahmedabad-based civil construction firm filed draft papers for an estimated Rs 550 crore ($82 million) IPO, which will comprise a fresh issue of equity shares worth Rs 450 crore. Promoter Kanubhai Patel Trust will sell three million shares.
Monte Carlo Fashions, part of the Punjab-based Nahar Group, was listed on the bourses in December 2014. It sells woollen knitted garments including shirts, trousers, denims, and women’s wear under the Monte Carlo brand.
Oswal Woolen Mills Ltd, the flagship company of Nahar Group, began its operations in 1949 in Ludhiana with a focus on hosiery and textile fabrics. It launched the Monte Carlo brand in 1984.
Incidentally, Monte Carlo Fashions had last year filed a case seeking to restrain auto major Skoda from using the name “Monte Carlo” for one of the variants of its cars. It had alleged trademark infringement on that occasion and managed to secure a temporary injunction.
Ahmedabad-based Montecarlo was incorporated in 1995 as a private firm. It is an infrastructure construction and development company, with operations spread across highways, railways, buildings and factories, mining, energy infrastructure and water and irrigation verticals.
The construction firm plans to use Rs 300 crore out of net proceeds from fresh issuance for working capital requirements besides using Rs 50 crore to part-finance the expansion and reinforcement of its Hubli-Haveri road project.
Edelweiss Financial Services, Axis Capital, and IDFC Bank are the merchant bankers managing the IPO.
Since its incorporation, the company has completed 66 engineering, procurement and construction (EPC) projects valued at Rs 5,307.87 crore as of December 2017, and had 31 projects ongoing across 11 states and one union territory.
So far this calendar year, the company has won 11 new infrastructure construction and development projects in eight states with a total order value of Rs 4,662.28 crore.