Online marriage services provider Matrimony.com Pvt. Ltd and Ahmedabad–based multi-specialty hospital chain Shalby Hospitals Ltd have received the Securities and Exchange Board of India’s (SEBI) approval for an initial public offering.
The capital markets regulator issued final observations to Matrimony’s IPO proposal on 13 July and Shalby Hospitals’ draft plan on 14 July. This takes the tally of companies that have received approvals for IPO this calendar year to 20, SEBI’s website showed.
The total size of the IPO is likely to be around Rs 500 crore ($78 million), persons familiar with the matter had earlier told VCCircle. The company was earlier looking at an IPO worth Rs 550 crore, of which around Rs 200 crore was to go to its selling shareholders.
As per the revised offering, the company has reduced the amount it plans to raise via a fresh issue of shares to Rs 130 crore from Rs 350 crore earlier. It has, however, more than doubled the number of shares being sold by promoters, including founder and CEO Murugavel Janakiraman, and its venture capital investors to 3.76 million shares from 1.66 million shares.
Now, Draper Investment and HartenBaum Trust are not among the selling shareholders but global venture capital firm Mayfield will sell 155,760 shares while JPMorgan will sell 1.68 million shares, or one-third of its holding in the company.
The plan of the US-based venture capital and growth capital investor Bessemer Venture Partners to sell its entire stake in Matrimony.com remains unchanged. It had invested in the company nearly six years ago and will sell 1.46 million shares, representing a 6.87% stake on a pre-offer basis.
Matrimony.com was earlier aiming to launch its IPO last November. However, market volatility arising due to a host of domestic and global factors—including the government’s ban on old high-value banknotes—led to a change in the perception on the valuation. It had approval till 18 December 2016 to launch an IPO. A company gets one year to float an IPO from the date of receiving SEBI’s approval.
The firm also has a new set of merchant bankers to manage the IPO—it has appointed ICICI Securities and Axis Capital as lead managers. The company was earlier being advised by Kotak Investment Banking, Citigroup Global Markets and Deutsche Equities India.
The multi-specialty hospital chain operator had filed its draft prospectus on 19 May. The public issue will comprise a fresh sale of shares worth Rs 580 crore and a partial sale of shares by promoter Vikram I Shah, according to the prospectus.
Shah will sell 1 million shares and his shareholding will decline to roughly 7.5% on a post-offer basis from 9.85%. .
The total issue size is estimated to be Rs 600-620 crore (around $97 million). This may result in a stake dilution of 15-18% on a post-offer basis. This values the firm around Rs 4,100 crore based on the estimated fundraising.
VCCircle had first reported in September last year that Shalby was eying an IPO and was in the process of hiring merchant bankers.
The firm had earlier explored raising capital via private equity funds, but then decided to list as it would allow it to raise more money.
Shalby will be part of a growing number of healthcare companies that have opted to raise capital via an IPO in recent times.
Bangalore-based hospital chain Narayana Healthcare raised $95 million through a public offering in December 2015 while oncology chain HealthCare Global Enterprises Ltd went public in March 2016 with a $100-million IPO. Aster DM Healthcare also filed a draft proposal in July 2016 for a $300-million listing. It, however, postponed its IPO plans.
Several drugmakers and diagnostic companies have also gone public over the past year.
Shalby’s chief executive officer Ravi Bhandari in an earlier conversation with VCCircle had hinted at enhancing its focus on west and central India, including in cities such as Ranchi, Bhopal and Pune.
Though Shalby has not actively acquired any companies of late, it had acquired a string of small hospitals, such as Vrundavan Hospital and Research Centre, Usha Hospitals and Krishna Hospital in 2011 and 2012, as per VCCEdge, the data research arm of News Corp VCCircle.
Edelweiss Financial Services, IDFC Bank and IIFL Holdings are the book-running lead managers for the IPO.