UFO Moviez opens IPO, cuts issue size by a fifth; raises $28M from anchor investors

Digital cinema solutions firm UFO Moviez India Ltd has raised Rs 180 crore ($28.5 million) from a bunch of domestic and foreign investors that have come as anchor investors ahead of its proposed initial public offer (IPO) which opened for subscription on April 28.

The digital cinema distributor has allotted 2.28 million equity shares at a share price of Rs 625 to 10 anchor investors.

The investors who participated in this round include mutual funds under Reliance Capital, SBI and Kotak Mahindra besides entities associated with PineBridge Global, Jupiter South Asia, Amundi, Ashmore SICAV and Bharti AXA Life Insurance.

Meanwhile, the firm opened its IPO with a price band of Rs 615-625 a share, which would allow it to raise around Rs 420 crore (excluding anchor allotment).

This means the firm has cut the overall size of issue by a fifth. When it had filed its documents last December, it had sought to raise up to Rs 750 crore through the offer-for-sale issue. It has now cut this by a fifth to Rs 600 crore.

At the end of day 1, close to 12 per cent of the issue was covered. While the QIB portion of the issue was subscribed 22 per cent, retail investors’ portion saw 9 per cent subscription and HNIs and corporates bid for 3.5 per cent of the shares reserved for them.

The issue would see both its private equity backers—3i and Providence— besides promoters sell shares.

The issue comprises around 35 per cent of the capital valuing the firm at a little over Rs 1,700 crore.

Providence, which invested in the company in 2011, is the single-largest shareholder, while 3i, which backed UFO Moviez in 2007, is the second-largest equity holder in the firm.

While Providence is expected to part exit, it is not yet clear how much stake is 3i paring in the IPO.

For Providence, this would come as second liquidity event from its India portfolio after part exiting Idea Cellular last September.

Axis Capital and Citigroup are the bankers to the IPO, which closes on April 30.

UFO Moviez is India’s largest digital cinema distribution network and in-cinema advertising platform (in terms of numbers of screens), according to CRISIL. It operates a satellite-based, digital cinema distribution network.

(Edited by Joby Puthuparampil Johnson)

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