Goenka Diamond and Jewels IPO to open on March 23

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Goenka Diamond and Jewels is entering capital market with an initial public offering (IPO) of one crore equity shares of face value of Rs 10 each on March 23, 2010.

The issue shall constitute 30.93% of the fully diluted post issue paid up capital of the company. The company is considering a pre-IPO placement of equity shares with certain investors. If the pre-IPO placement is completed, the issue size would be reduced to the extent of such pre-IPO placement, subject to a minimum issue size of 25% of the post issue paid-up share capital of the company. The issue will close on March 26.

Promoters' holding will be reduced to 69.07% from 100%. Nand Lal Goenka, Navneet Goenka and Nitin Goenka are main promoters of this company, which will dilute their stake to 55.27% from 80.01% via this issue.

The company is in the business of cutting and polishing of diamonds and manufacturing and retailing of diamond jewellery. Its diamond processing business consists of trading, cutting and polishing of diamonds. Jewellery Business consists of manufacturing and retail of jewellery under CERES and G WILD brands.

The objects of this Issue are to meet the expenses of establishing stores for G WILD Stores; meet the expenses of establishing stores for CERES Stores; meet working capital requirements for jewellery business; meet the expenses of establishing a jewellery manufacturing facility in Mumbai; meet the expenses of establishing a diamond processing facility in Mumbai and further invest in the equity capital of subsidiary. The company will utilise around Rs 123.55 crore for above objects.

The book running lead manager to the issue is SBI Capital Markets Limited and Karvy Computershare Private Limited is the registrar.