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B.K. Modi's Spice Group plans to raise $1 billion through a London listing in the next 10 months.
The Singapore-based businessman confirmed his plans to list Spice Global, the holding company of his two businesses, Mumbai-based Spice Mobility and Singapore-based Spice i2i by March 2012.
The company hopes to achieve a valuation of $2 billion, he said on Thursday.
The proceeds will be used to complete the company's plans to expand from the “Ivory Coast to Indonesia” (i2i) providing it the base for expansion into West Asia and Africa.
London would act as the financial and administrative hub for the group, Mr Modi said in a meeting in London on Thursday. The company had previously said it was mulling a number of options for the listing of the holding company, including Singapore.
India would remain the firm's knowledge centre, and Singapore its innovation base. Mr Modi said the company had chosen London because of its proximity and strong links to both Africa and West Asia, where it is planning to make acquisitions in mobile retail, distribution and device companies. “We have acquisitions in the offing,” he said. “London is not only London any more but a place where America and Europe are coming together — it is also a place where people from the whole African continent, West Asia and the Commonwealth are”.
The combined revenues of the Spice Group's two arms are projected to reach $1.5 billion in 2012, and $3 billion in 2014. Mr Modi hopes the listing will achieve a valuation in the region of $2 billion. “We are waiting for the right market,” he said.
The company has completed the consolidation of its Mumbai arm, through the merger of Spice Mobiles and Spice Televentures, and is in the process of consolidating Spice i2i country by country. The company acquired Affinity, an Indonesian mobile device maker and distributor earlier this year for $175 million.
Outlook
Going forward, the company will focus on growth in the mobile Internet market, said Mr Modi. While handsets, for example, would continue to be marketed locally under their known brands, expansion in this growth area would happen under the Spice brand itself. “In the i2i markets the penetration of mobile Internet is very low,” he said. “Our research suggests you will get a jump in technology, people will not use the Internet at all but go straight to the mobile Internet.” The company would cater to this market in those countries by providing low-cost options.
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