Education-focused publishing house S Chand & Company is planning to raise close to ₹650 crore through an initial public offering (IPO), paving way for partial exit of private equity firm Everstone Capital.
The 60-year-old firm will file a Red Herring Prospectus (RHP) with markets regulator SEBI within a week and intends to hit the market before month-end, at least three sources told BusinessLine .
“The company is planning a fresh issue of ₹300 crore and an offer for sale of about 6 million shares by promoter and PE investors in the range of ₹350 crore,” one of the sources said.
In 2012, S Chand raised ₹200 crore from Everstone Capital in lieu of a 31 per cent stake and later in 2015, it raised an additional $27 million from Everstone and IFC to scale up its presence in the educational content space.
The sources declined to be identified before a formal announcement. When contacted S Chand Managing director Himanshu Gupta refused to divulge the timeline and quantum of the IPO, but added the company will be guided by advisers.
S Chand — which provides educational content for Kindergarten to Std XII, higher education and early-learning segments — had received regulatory clearance for the IPO with SEBI’s observation on March 3.
The New Delhi-headquartered firm had filed its draft red herring prospectus (DRHP) with SEBI on December 19, 2016.
JM Financial, Axis Capital and Credit Suisse are the bankers to the issue. S Chand will use ₹240 crore of the proceeds to repay a loan, much of it was used to finance its acquisition of Chhaya Prakashani, and remaining would be used for organic growth.
Expansion plans The company, according to the DRHP, was also scouting to acquire regional content houses, while it also had plans to further its presence in the higher education business, particularly in the test preparation market.
In fiscal 2011, S Chand’s most important subjects were English grammar, Maths and Science. But then, the company made a string of acquisitions to expand its portfolio.
In 2013, the company acquired two brands — Madhubun and Vikas — to improve its Hindi language titles in the K-12 businesses and later in fiscal 2015, it acquired Saraswati brand to strength its French, languages, arts and crafts titles. In Fiscal 2016, S Chand sold 35.47 million copies of its titles.