Mathew Cyriac, the former co-head of private equity firm Blackstone Advisors India, has earned a massive 15-fold return on his investment in MTAR Technologies, a precision engineering solutions company, which recently closed its IPO.
MTAR Technologies' Rs 596-crore initial public offering, which was available from March 3-5, was subscribed 200 times, the second-highest subscription among IPOs that raised more than Rs 100 crore in the last five years.
Cyriac, who picked a 33.11 percent stake in MTAR in 2017, garnered a neat Rs 332.6 crore by selling 5,784,300 equity shares, more than 20 percent pre-IPO stake in the company, at Rs 575 per share.
Cyriac through his two entities, Fabmohur Advisors LLP and Solidus Advisors LLP, held 33.11 percent equity stake in MTAR Technologies prior to 10 days of filing red herring prospectus for the IPO. After the pre-IPO placement, their stake reduced to 30.97 percent a day prior to filing of RHP.
The reason of the drop in the stake from 33.11 percent to 30.97 percent was the pre-IPO placement done by the company. Axis MF and SBI MF among others acquired 6.08 percent stake in MTAR in a pre-IPO placement.
Cyriac had bought the stake from private equity firm Blackstone at a price of Rs 38.44 per share, which translates to Rs 34 crore worth of stake in 2017. He quit as co-head of Blackstone Advisors India Private Limited the same year.
The sum of Rs 332.6 crore garnered is 15 times the investment of Rs 22.23 crore he made in 2017. Cyriac now holds around 10 percent stake in MTAR Technologies, which is valued at around Rs 177 crore at a price of Rs 575 per share.
Cyriac is a Nominee Director on the board of MTAR. He is also the Executive Chairman of Florintree Advisors, an India-focused Alternative Asset Manager, based in Mumbai. Cyriac was earlier a senior managing director at The Blackstone Group and served as its co-head of private equity at Blackstone Advisors India Private Limited till February 2017.
Besides having an investment in MTAR, Cyriac has an active role in the board with involvements in the audit committee, nomination and remuneration committee as well as the management committee.
P Simhadri Reddy, another investor in the company, had bought 90,975 equity shares in the company at Rs 119.64 per share. He received Rs 5.175 crore by selling 90,000 shares in IPO against an investment of Rs 1.07 crore for the same shares.
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MTAR Technologies primarily serves customers in the clean energy, nuclear and space and defence sectors. Its IPO comprised a fresh issue of Rs 123.5 crore and an offer for sale of Rs 473 crore by promoters and investors. Promoters received Rs 135.2 crore through offer for sale.
The fresh issue and pre-IPO placement funds would be utilised for debt repayment and working capital requirements.
Note: All the information mentioned in the copy is available in the RHP and for calculation, we considered final issue price of Rs 575 per share.
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