Rajesh Yabaji, co-founder and promoter of Zinka Logistics Solutions Ltd, which runs the logistics tech platform BlackBuck, has received 5.85 million shares as a gift from his investors and co-founders ahead of the company’s initial public offering (IPO), which opens on 13 November, regulatory filings show.
At the upper end of the Blackbuck IPO price band of Rs 259-273 per share, these shares are worth approximately Rs 160 crore.
While most shares were transferred as a gift, some shares were transferred at a price of Re 1 per share, the filings show.
The total shares gifted to Yabaji represent a 3.6 percent shareholding of the company. The shares were transferred to Yabaji in October.
Investors who transferred shares to Yabaji include Sands Capital, International Finance Corp and Sanjiv Rangrass, an angel investor of the company, and co-founders and promoters Ramasubramaniam Balasubramaniam and Chanakya Hridaya. The bulk of the shares were transferred by the co-founders.
With these additional shares, Yabaji has become the single largest shareholder in the company, filings show, with a 14.45 percent stake (pre-IPO), ahead of its other big shareholders such as Accel and Flipkart entity Quickroutes International Private Ltd.
Also Read: Zinka Logistics Solutions IPO: Here are 10 key things to know before subscribing to the issue
Why the share transfer?
These share transfers represent the company and investors' efforts to compensate for Yabaji's contribution to growing the company over the years, said people aware of the matter.
“These (share transfers) are compensation for the founder. Under SEBI norms, a promoter is not eligible to hold or receive employee stock options (ESOPs), which is the most popular route to incentivise management,” said one of the people cited above.
“Hence, the founders who are categorised as promoters end up losing out on significant wealth creation. Thus investors and companies negotiate such transfers to compensate the founders,” the person added.
Emails sent to BlackBuck and Yabaji did not elicit a response.
BlackBuck IPO
Zinka Logistics, which is India’s largest digital platform for truck operators (in terms of number of users), with 963,345 truck operators in the country transacting on its platform in fiscal 2024, opened its IPO for public subscription on November 13. The IPO will close on November 18.
Investors can bid for a minimum of 54 equity shares and in multiples of 54 equity shares thereafter.
Also Read: Zinka Logistics IPO GMP rises despite weak market ahead of Nov 13 issue opening
The IPO is a mix of fresh issue of up to Rs 550 crore and an offer for sale of up to 20.68 million shares by the promoters and investors.
The proceeds from its fresh issuance will be utilised to the extent of Rs 200 crore towards sales and marketing costs, Rs 140 crore for investment in BlackBuck Finserve Private Ltd for financing the augmentation of its capital base to meet its future capital requirements, Rs 75 crore for funding of expenditure in relation to product development, and general corporate purposes.
As of fiscal 2024, the company had grown its fleet to 963,345 truck operators, up from 482,446 in fiscal 2022, representing 27.52% of India’s truck operators.
Zinka Logistics processed a gross transaction value (GTV) of Rs 5,356.20 crore and Rs 17,396.19 crore in payments in the three months ended June 30, 2024 and fiscal 2024, respectively. The payments platform addresses significant expenses for truck operators, such as tolls and fuel. The company partners with FASTag banks and multiple oil marketing companies to offer tolling and fuelling solutions, generating revenue through commission margins based on transaction values.
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