Ahmedabad-based hospitality firm, Four Seasons Residency Ltd, on Wednesday, filed a draft red herring prospectus with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO).
The IPO comprises a fresh issue of 10 million shares, which results in a stake dilution of 38.89% in the company’s equity capital, according to the draft prospectus.
The IPO size is estimated to be Rs 125-150 crore ($18-22 million), said a person familiar with the development. The proceeds will be utilised to build a 230-room hotel in Gandhinagar, Gujarat.
Four Seasons is the eighth Indian company to file a draft prospectus in 2017, SEBI data showed.
Private equity firm Warburg Pincus-backed Au Financiers (India) Ltd, state-run Housing and Urban Development Corporation Ltd (Hudco) and SREI Infrastructure-promoted Bharat Road Networks Ltd (BRNL) are among other firms that have filed their IPO draft proposals with the capital markets regulator in 2017.
Snapshot of the issue:
Issue
The company seeks to raise Rs 125-150 crore ($18-22 million) through fresh issue of shares. It is aiming to list its shares on the exchanges by the first quarter of 2017-18.
Use of Proceeds
The company intends to use the money for setting up a hotel, meet issue expenses (Rs 1 crore or $1.5 million), besides using the funds for general corporate purposes.
Merchant banker(s)
Chartered Capital and Investment Ltd are sole financial advisors to the Four Seasons’ IPO.
Lawyer(s)
Advocate Narendra Tahilramani is the legal advisor representing the company in all matters, including the IPO.
Company
Four Seasons was incorporated in April 2009 with the aim to build a 230-room hotel, The Westin, off the Gandhinagar-Ahmedabad road. It is scheduled to go public on 1 April 2020.
The company counts Viral M Shah (3.07% stake) and Rupen M Modi (0.06% stake) as promoters and Sampati Securities Ltd (75.48% stake) as its promoter-group company.
Four Seasons purchased 22,844 sq. metres of land in April 2015 from Neela M. Mody and Rinku R. Mody (mother and wife, respectively, of Rupen M Modi, director of Four Seasons). The total cost of acquiring the land, including statutory duties and levies, was Rs 42.36 crore.
Financials
At present, there is no business activity in the company.
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