Tuesday, January 4, 2011

Sebi gives nod to Muthoot Finance IPO

Market regulator Sebi has given nod to Kerala-based Muthoot Finance to raise about Rs. 800 crore through an initial public offer (IPO).

Muthoot Finance, which claims to be the largest gold financing company in India in terms of loan portfolio, will issue 5.15 crore shares through the IPO that will see a divestment of 13.85 per cent stake, as per the draft Red Herring Prospectus.

According to sources, the company which filed draft prospectus with the Securities and Exchange Board of India (Sebi) on September 30, would raise around Rs. 800 crore.

Sebi gave approval to the company on December 31, three months after it filed the prospectus.

The IPO proceeds will be utilised to augment capital base for meeting future capital requirements, for funding of loans and for general corporate purposes.

The company provides personal and business loans secured by gold jewellery (or gold loans).

Kotak Mahindra Capital and HDFC Bank are the book running lead managers to the issue.

Shares offered through the IPO are proposed to be listed on the National Stock Exchange and the Bombay Stock Exchange. The pricing of IPO will be based on book-building method.

Besides Muthoot Finance, Sebi also gave approval to AGS Transact Technologies Limited and P & G Electroplast Limited to launch IPO.