The Hindu Business Line : Edelweiss completes Rs 46.6-cr QIP for Spentex

Edelweiss Capital has completed the qualified institutional placement (QIP) of Rs 46.59 crore for Spentex Industries Ltd, the first QIP by any Indian company after fresh guidelines were notified by the Securities and Exchange Board of India (Disclosure and Investor Protection) Guidelines, 2000 to qualified institutional buyers (QIBs) in May 2006, an official statement said.

Through QIP guidelines, SEBI has opened a window for Indian companies to raise funds domestically instead of exporting the private placement market out of India through overseas issuances.

Share allotment

Edelweiss Capital, the sole lead manager on the placement, has allotted 75 lakh equity shares to QIBs and raised Rs 46.59 crore for Spentex Industries to fund the company's future expansion. The shares in the QIP have been allotted to Sundaram Mutual Fund, Goldman Sachs Investments (Mauritius) Ltd, Voyager Fund (Mauritius) Ltd and Nikko Asset Management (Mauritius) Ltd.

Commenting on the QIP issuance, Mr Rashesh Shah, CEO and Managing Director, Edelweiss, said, "These new guidelines have been a significant step forward for Indian capital markets. Through this the equity private placement market will come back onshore. This will also allow the Indian mutual funds — which are increasingly becoming a large investor base comparable to the FIIs — to participate in these issuances. This has created a level playing field and removed a substantial aberration from the market place."

Mr Mukund Choudhary, Managing Director, Spentex Industries, said, "While we were looking at raising capital to fund our global expansion plans, we are pleased with our investment partners, Edelweiss Capital, which who understood our requirement and suggested the recently permitted QIP route. Through Edelweiss Capital, we have secured the confidence of Sundaram and other prominent FIIs who actively participated in our fund raising exercise."

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