Sona Comstar receives Sebi’s aproval to launch Rs 6,000Cr IPO
Sona BLW Precision Forgings (Sona Comstar) has received the green flag from markets regulator, SEBI to raise Rs 6,000 crore via an initial share sale.
The IPO includes a fund-raise by fresh issue amounting to Rs 300 crore and an offer for sale aggregating up to Rs 5,700 crore by selling shareholder Singapore VII Topco III Pte Ltd, an associate of the Blackstone Group Inc, as per the draft red herring prospectus (DRHP).
Sona Comstar filed preliminary IPO papers in February and received Sebi’s observation on May 6, an update with the markets regulator revealed on Monday.
Sebi’s observation is essential for any company to roll out public issues like initial public offer (IPO), follow on public offer (FPO), and rights issue.
The Blackstone-backed company plans to use the funds raised from the fresh issue to repay/prepay Rs 225 crore of its borrowings and for general corporate purposes.
The company focuses on designing, manufacturing, and supplying highly engineered critical automotive systems and components such as differential assemblies, differential gears, conventional and micro-hybrid starter motors, BSG systems, EV traction motors, and motor control units.
It provides components to automotive OEMs across the US, Europe, India, and China, for both electrified and non-electrified powertrain segments and is not reliant on a single product, vehicle segment, customer, or geography.
The company is also one of the two biggest exporters of starter motors from India apart from being the biggest manufacturer of differential gears for passenger vehicles, commercial vehicles, and tractors in the country.
Some of its chief OEM customers include a global OEM of EVs, a North American passenger vehicle and commercial vehicle maker, Ashok Leyland, Daimler, Escorts, Mahindra & Mahindra, Mahindra Electric, Maruti Suzuki, Renault Nissan, Volvo, and Volvo Eicher.
Kotak Mahindra Capital Company, Credit Suisse Securities, JP Morgan India, JM Financial, and Nomura Financial Advisory and Securities are appointed as the book running lead managers (BRLM) of the issue.
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