Advent International, the US-based private equity firm, and Singapore’s Temasek Holdings are set to sell up to $185 million (Rs.1,328 crore) worth of shares in Crompton Greaves Consumer Electricals on Tuesday.
The global investors move aims to take advantage of the recent rally in stock markets, providing a near three-times return on a four-year-old investment and enable fundraising options for other business ventures.
Advent International Corp’s Amalfiaco and Temasek’s MacRitchie Investments Pte Ltd are selling up to 5.54 crore shares in the CG Consumer.
The global investors together hold 34.36% stake in the firm, will be diluting roughly 26% of their holding through the block deal.
Advent and Temasek have set a floor price of Rs.240 a piece, which is up to 4.8% discount to CG Consumer’s Monday’s closing price of Rs.252.
Citigroup is running a formal sales process.
Advent and Temasek teamed up and acquired CG Consumer from Gautam Thapar and his family, the promoters of the diversified Avantha Group in 2015, roughly paying Rs 105 per share, valuing the company at around Rs 2,000 crore.
CG Consumer Electricals, incorporated in the year 2015, is a Large Cap company (having a market cap of Rs 16614.41 Crore) operating in Consumer Durables sector.
CG Consumer’s key Products/Revenue Segments include Electrical Consumer Durables which contributed Rs.3200.35 Crore to Sales Value (71.45 % of Total Sales), Lighting Products which contributed Rs 1261.95 Crore to Sales Value (28.17 % of Total Sales), Scrap which contributed Rs 8.23 Crore to Sales Value (0.18 % of Total Sales), Export Incentives which contributed Rs 6.80 Crore to Sales Value (0.15 % of Total Sales) and Sale of services which contributed Rs 1.58 Crore to Sales Value (0.03 % of Total Sales)for the year ending 31-Mar-2019.
For the quarter ended September 30, the company has reported a Consolidated sales of Rs 1075.79 Crore, down 20.12%.
It reported a net profit after tax of Rs 110.88 Crore.
What does this OFS mean to shareholders ahead?
We understand that this OFS will be comfortably subscribed by large institutional holders who like this stock considering its strong business and branch reach
Already in the morning today around 8% equity had changed hands at an average price of Rs 251 on the BSE
Longer-term once the macros improve and demand picks up one could see stronger traction in the company’s performance ahead
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