The capital markets regulator Securities and Exchange Board of India (SEBI) has given its approval to the proposed initial public offerings (IPOs) by enzyme manufacturer Advanced Enzyme Technologies Ltd and business services provider Quess Corp, according to a disclosure.
While Quess Corp had filed its draft red herring prospectus (DRHP) with SEBI in February this year, Advanced Enzyme had filed the papers with the capital markets watchdog in January.
Advanced Enzyme is looking to raise Rs 60 crore (around $8.8 million) through a fresh issue of shares besides an offer for sale of 3.1 million equity shares by its promoters, 0.5 million shares by Kotak Private Equity and 0.85 million shares by other shareholders.
The company manufactures and markets more than 400 proprietary products developed from 60 indigenous enzymes. It has more than two decades of fermentation experience in the production of enzymes and claims it ranks among the top 15 global firms in terms of enzyme sales, and has the second-highest market share domestically, next only to the world leader Novozymes.
It operates in two business verticals—healthcare & nutrition (human and animal) and bio-processing (food and non-food); healthcare & nutrition generates bulk of its revenues. It offers its products to more than 700 customers in 50 countries.
Of Rs 60 crore that the firm plans to raise through the fresh issue, it will use a major portion (Rs 50 crore) for repaying debt availed by its American arm from its promoters. The wholly owned firm Advanced Enzymes USA had borrowed $20 million from a group firm and promoter Vasant Laxminarayan Rathi against promissory notes dated December 13, 2012 carrying an interest rate of 3.5 per cent per annum.
The money was used for repaying certain other promissory notes issued to pay for purchase of shares of its step-down arm Cal India Foods International.
Quess, earlier known as IKYA Human Capital Solutions Ltd, is the second firm to file for IPO this year after Advanced Enzyme.
The company had said in March last year that it was evaluating various funding options, including an IPO. If it goes ahead with the public issue, it would become the second listed firm for Canada’s Fairfax Financial Holdings in India.
Its parent Thomas Cook is already a listed firm.
The company is looking to mop up around Rs 400 crore through the fresh issue of shares.
It plans to use the money for repayment of debt (Rs 50 crore) as well as capital expenditure of the holding company and American arm MFX (Rs 70.68 crore); incremental working capital requirement (Rs 157.9 crore); acquisitions and other strategic initiatives (Rs 80 crore), besides other purposes.
IKYA was founded by serial entrepreneur Ajit Isaac, who sold PeopleOne Consulting to Swiss staffing giant Adecco in 2004. It was acquired by travel and tour company Thomas Cook in early 2013 for Rs 256 crore. The deal marked an exit for India Equity Partners, which invested in IKYA back in 2008. It was rebranded as Quess earlier last year.
Originally, it was a staffing services firm but with a string of acquisitions, especially after it came under Thomas Cook, it expanded aggressively and now provides solutions including recruitment, temporary staffing, IT products and solutions, skill development, payroll, compliance management, integrated facility management and industrial asset management services.
A majority of its business (55 per cent) comes from its people and services unit, followed by global technology solutions (28 per cent), facility management (12 per cent) and industrial asset management (5 per cent).
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