Five Star Business Finance raises Rs 588 crore from anchor investors

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Non-bank financial firm Five Star Business Finance Ltd said on Monday that it had raised Rs 588 crore from anchor investors ahead of its initial public offering (IPO) which will open on Wednesday.

The initial sale of the lender’s shares will close on November 11.

The company has decided to allocate 1.24 crore of shares to anchor investors at Rs 474 each, aggregating the deal size to Rs 588 crore, according to a circular uploaded on the BSE website.

SmallCap World Fund, Fidelity Investments, Capital Research, Malabar Investments, Government Pension Fund Global, Abu Dhabi Investment Authority, Norges Bank, Carmignac Gestion, White Oak, Bay Capital, Segantii, SBI Life Insurance, HDFC Mutual Fund (MF), Baroda BNP MF, Edelweiss MF and Mirae MF are among the main investors.

The Initial Public Offering is entirely an offer for sale (OFS) of shares in the amount of Rs 1,960 crore by existing shareholders and promoter group entities.

The ChennaiNew York-based NBFC is backed by investors including TPG, Matrix Partners, Norwest Ventures, Sequoia and KKR.

The SFO will see the sale of shares in the amount of Rs 166.74 crore by SCI Investments V, Rs 719.41 crore by Matrix Partners India Investment Holdings II LLC, Rs 12.08 crore by Matrix Partners India Investments II Extension LLC, Rs 361.44 crore by Norwest Venture Partners X- Maurice and Rs 700.31 crore by TPG Asia VII SF Pte Ltd.

Currently, TPG Asia holds a 21.45% stake, Matrix Partners holds 12.67%, Norwest Venture holds a 10.17% stake and SCI Investments holds an 8.79% stake in the company. .

Investors may bid for a minimum of 31 Equity Shares and in multiples of 31 Equity Shares thereafter.

Five Star Business Finance offers secured business loans to micro-entrepreneurs and the self-employed, the two borrower segments largely excluded by traditional financial institutions.

ICICI Securities, Kotak Mahindra Capital Company, Edelweiss Financial Services and Nomura Financial Advisory and Securities (India) Private Limited are lead managers for the issuance.

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