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Everstone-backed S Chand raises $34 mn from anchor investors

25 April, 2017

Education-focused publishing company S Chand & Company Ltd on Tuesday raised Rs 219 crore (around $34 million) from anchor investors ahead of its three-day initial public offering that opens on Wednesday.

The company, which is backed by Everstone Capital, allotted 3.2 million shares at the upper end of the Rs 660-670 price band.

Fifteen investors acquired shares in the anchor allotment.

Prudential Corporation Asia, one of Asia’s leading life insurance companies, acquired 2.99 lakh shares through its investment vehicle Eastspring Investments India Consumer Equity Open Ltd.

Other anchor investors include Nomura Singapore Ltd, Indus India Fund (Mauritius) Ltd, Volrado Venture Partners Fund-II and HSBC Global Investment Fund.

Anchor investors are institutional investors who accept a one-month lock-in period for a sizeable allocation of shares and support a public offering. Their participation highlights investors’ confidence in an IPO and sets a benchmark for the investor community at large.

Among Indian asset managers, HDFC Company Trustee Ltd, Axis Mutual Fund, Sundaram Mutual Fund and Birla Sun Life Asset Management acquired S Chand’s shares as part of the anchor allotment.

Among insurers, HDFC Standard Life Insurance Company and SBI Life Insurance Company picked shares.

Last week, the company increased the size of its initial share sale, as it looks to benefit from the uptrend in stock markets this year.

The firm now aims to raise Rs 325 crore by issuing new shares, according to its red herring prospectus filed with market regulator Securities and Exchange Board of India (SEBI). It had earlier targeted to mop up Rs 300 crore.

The IPO also includes an offer for sale of about 6 million shares by Everstone and other shareholders, including the promoters. The selling shareholders will mobilise up to Rs 403 crore.

At the upper end of the price band, the company will have a valuation of Rs 2,325 crore ($360 million).

S Chand is one of close to a dozen companies that received regulatory approval to float an IPO. In addition, around 10 firms have sought clearance from SEBI to go public.

The companies that have already floated their IPOs this year include stock-exchange operator BSE Ltd; Avenue Supermarts Ltd, which operates hypermarket chain D-Mart; FM radio firm Music Broadcast Ltd and Shankara Building Products Ltd.

S Chand, which is also backed by International Finance Corporation, had filed its draft red herring prospectus with SEBI on 19 December. It received SEBI’s clearance last month.

The IPO comes barely months after S Chand made one of the largest acquisitions in India’s education-related publishing segment. As first reported by VCCircle, it picked up a majority stake at an enterprise value of Rs 220 crore ($32.8 million then) in Kolkata-based Chhaya Prakashani Pvt. Ltd, which publishes books for schools students of up to 12th standard (K-12) as well as college and engineering students.

For further details on the company and its IPO, click here

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Everstone-backed S Chand raises $34 mn from anchor investors

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