Standard Chartered Private Equity (SCPE) is picking a 10.14% stake in Pune-based Innoventive Industries Ltd, a multi-product engineering company, by investing Rs 46 crore in the firm. The deal includes a primary infusion of Rs 30.4 crore as part of a pre-IPO investment in the firm.
VCCircle was the first to break the story (February 14, 2011) on SCPE investing $10 million in the engineering firm.
In October last year, Innoventive filed a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO) to raise Rs 250 crore. Axis Bank and Avendus Capital are the book running lead managers to the issue. According to the DRHP, the company’s consolidated revenue increased from Rs 371.09 crore in FY09 to Rs 425.15 crore in FY 10. Profit after tax increased from Rs 14.14 crore to Rs 27.72 crore during this period.
The firm will use the funding to part-finance the expansion of its precision steel tube manufacturing facilities at Pune. Innoventive is a multi-product engineering company focused on precision steel tubes and value added steel products (including boiler steel strips) and oil well couplings (through its subsidiary).
The company’s product range find application in diverse industrial sectors including transportation, oil & gas, power, farm equipments and general engineering.
Chandu Laxman Chavan-led Innoventive Industries Limited, formerly Arihant Domestic Appliances Ltd, received its first round of PE funding from Lighthouse LLC. The PE firm has William Sean Sovak as Nominee Director in Innoventive. Established in 1991 for manufacturing of domestic appliances, the firm was taken over by a group of first generation technocrats under the leadership of Chandu Laxman Chavan in 2002.
Rahul Raisurana, Managing Director, Standard Chartered Private Equity, said, "The precision tubes, tubular products and related spaces present significant growth prospects. We have found Innoventive Industries to be the right partner because of its focus on product and process, a key differentiator for the company."
The Rahul Raisurana-led StanChart Mid-Market-Mid Cap Fund has invested $10.62 million (Rs 50 crore) in Gurgaon-based PI Industries Ltd, an agri-input and fine chemicals company, engaged in the production of agrochemicals, seeds and specialty fertilizers, for 5.23% stake. It has also invested in constrution firm Man Infraconstruction, which was listed last year.
Another fund under management by StanChart PE, led by Nainesh Jaisingh, invested $50 million in Coffee Day Resorts & Hotels Ltd, a wholly-owned subsidiary of Amalgamated Bean Coffee Trading Co. Ltd for a 5% stake last year.