Financial investors Lehman Bros, Deutsche Securities and Merrill Lynch (now controlled by Bank of America) are making partial exits of their investment in travel and tour operator Cox & Kings (India). The three together own 11% in the company which is coming up with an initial public offer (IPO) expected to be of the size of around Rs 400 crore.
The IPO comprises fresh issue of 15.45 million shares and offer for sale of around 3 million shares from the financial investors. This could mean issue being priced at around Rs 260/share.
The sellers would pocket close to Rs 78 crore together. It is not clear at what price Lehman Bros Opportunity Fund, Deutsche Securities, Mauritius and Merrill Lynch Capital, Espana bought their shares. As of now the three own 3.9%, 3.9% and 3.2% respectively in Cox & Kings (India). The three investors are selling a little more than half of their total holdings.
At Rs 260 per share the company would be valued at Rs 1,635 crore (~$340 million). Promoted by Kerkar family, Cox & Kings (India) had revenues of Rs 293 crore for FY09 with net profit of Rs 63 crore. Interestingly, the travel firm managed to grow both revenues and profits last year even as global travel spends were impacted by economic slowdown. The company is looking to use the funds to repay existing loans, besides strategic acquisitions and other initiatives.