The Hindu Business Line : Mahindra Holidays files papers for IPO

Mumbai, Dec. 14 Leisure hospitality provider Mahindra Holidays & Resorts India Ltd has filed its draft red herring prospectus with SEBI for its initial public offering.

The parent company, Mahindra & Mahindra Ltd, informed BSE on Thursday that the price of 10,719,347 equity shares of Rs 10 each for cash will be decided through a 100 per cent book-building process.

The issue would constitute 13 per cent of the fully diluted post-issue paid-up capital of the company, said an official release. The issue comprises a fresh issue of 41,22,826 equity shares and an offer for sale of 65,96,521 equity shares by Mahindra Holdings & Finance Ltd. The selling shareholder is considering a pre-IPO sale of up to 24,73,695 equity shares to certain investors, the company informed the BSE.

The company will complete the transfer and sale of such equity shares prior to the filing of the RHP with the Registrar of Companies. If the pre-IPO sale is completed, the offer for sale and consequently the issue size offered to the public would be reduced, subject to a minimum issue size of 10 per cent of the post issue capital being offered to the public, said the company release.

Plans ahead

The proceeds from the IPO will be used to part finance expansion of some of its existing resorts and setting up of new projects. The company has plans to construct new resorts and projects at Puducherry, Kumbalgarh (Rajasthan), Kadambakkam (Tamil Nadu), Binsar (Uttaranchal), Theog (Himachal Pradesh), and Tungi (Maharashtra).

The equity shares offered through this DRHP are proposed to be listed on the NSE and the BSE. The company provides family holidays primarily through vacation ownership memberships. Its resorts offer the use of accommodation, such as apartments and cottages, and amenities and facilities, such as ayurvedic spas, kids clubs and a variety of holiday activities.

The company has pan-India coverage with a total of 21 resorts and 14 branch offices, 43 direct and 80 franchisee retail sales outlets as of October 31, 2007. It has 63,375 vacation ownership members in its fold. MHRIL’s flagship service offering is Club Mahindra Holidays.

The global co-ordinator and book running lead managers to the issue are Kotak Mahindra Capital Company Ltd, HSBC Securities and Capital Markets (India) Pvt Ltd.

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