Varroc IPO: Tata group to sell shares worth Rs 1,786 cr

PTI | Updated on June 26, 2018 Published on June 26, 2018

The initial public offering of auto component maker Varroc Engineering opened for public subscription today, with Tata Group set to sell shares worth Rs 1,786 crore.

Varroc Engineering, which supplies auto parts to Jaguar Land Rover, Bentley, Audi and Harley Davidson, has already raised Rs 584 crore from anchor investors, including Canadian pension fund CDPQ and Smallcap World Fund Inc.

The initial public offer (IPO), for which the company has set a price band of Rs 965-967, consists of an offer-for-sale to the tune of 2,02,21,730 equity shares by promoter Tarang Jain and existing investors.

While the promoter will sell up to 17,52,560 shares, Tata Group entities -- Tata Capital Financial Services and Omega TC Holdings -- will offload a total of 1.84 crore stocks, amounting to 13.7 per cent stake.

Omega TC will offload up to 1,69,17,130 equity stocks (amounting to 12.55 per cent stake) and Tata Capital will divest up to 15,52,040 scrips or 1.15 per cent holding. Tata Group will garner Rs 1,786 crore through the public issue.

Till 3 pm local time, the company’s initial share-sale was subscribed 31 per cent, as per the information available with the National Stock Exchange.

The share sale will close on June 28. At the upper end of the price band, the public issue will fetch Rs 1,955 crore.

Varroc said in a statement that the company’s IPO committee has finalised allocation of over 60.36 lakh shares to 30 anchor investors at Rs 967 apiece. At this price, the total proceeds would be around Rs 583.73 crore.

Nomura Fund Ireland Public Ltd, DSP BlackRock, ICICI Prudential Mutual Fund and SBI Mutual Fund are among other anchor investors.

Founded in 1990 in Aurangabad, Varroc is an automotive component manufacturer and supplier of exterior lighting systems, power-trains, electrical and electronics, body and chassis parts to passenger cars and motorcycle segments worldwide.

Kotak Mahindra Capital, Citigroup Global Markets India, Credit Suisse Securities India and IIFL Holdings are managing the issue.

Published on June 26, 2018
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