V-Mart Retail close to pre-IPO placement deal

MUMBAI: A group of brokerage firms and high net worth individuals is expected to pick up a minority stake in V-Mart Retail in a pre-placement deal ahead of the Delhi-based departmental store chain’s initial public offering next month, investment banking officials said.

“The company is close to making a pre-IPO placement of 12.5 lakh shares (7% equity, post IPO) at a price of Rs 210 per share to Lata Manek Bhanshali, wife of late Manek Bhanshali (one of the founders of Enam Securities ), Antique Finsec, Antique Stock Broking, Tejal Rohit Kothari of Antique, and some other HNIs for around Rs 26 crore,” an investment banking official said.

The deal will value V-Mart, which operates around 62 hypermarkets in tier-II and tier- III towns, at around Rs 400 crore and is expected to be concluded in the next few days, the person added. V-Mart MD Lalit Agrawal confirmed that it is talking to some investors for a stake sale, but declined to divulge details.

The retailer, which is backed by Aditya Birla Group’s investment firm Naman Finance, has lined up a Rs 100-110-crore public offering through issue of fresh capital and dilution of existing shareholders’ holdings.

Anand Rathi Advisors is the book-running lead manager to the issue. V-Mart will be the first retail chain to hit the capital markets after the government allowed foreigners to own stakes in local supermarkets and department stores.

After the listing, promoters’ stake in the company will come down to 59% from 70%, while Naman Finance’s holding will come down to 9% from 22%.