Branded hotel ownership and asset management platform Samhi Hotels, which operates top global players like Marriott, Hyatt and IHG in India, has refiled its draft red herring prospectus (DRHP) with market regulator Sebi to unlock value via an initial public offer (IPO), multiple industry sources with knowledge of the matter told Moneycontrol.
Moneycontrol was the first to report the listing plans of Samhi Hotels on May 15, 2019.
Backed by the likes of Goldman Sachs, Equity International, GTI Capital and IFC, the firm founded by Ashish Jakhanwala and Manav Thadani in 2010, filed for an IPO in September 2019 but later dropped the plans due to market conditions and the impact of the Covid-19 pandemic.
The company is now betting on the surge in domestic consumption and underlying GDP growth, due to which the Indian hospitality industry is seeing strong capacity utilisation in recent quarters of the Financial Year 2023.
According to the re-filed DRHP, Samhi Hotels is looking to raise Rs 1,000 crore via the fresh issue route and the IPO will also consist of an OFS component of up to 9,00,00,000 equity shares with all the key investors looking to dilute stake
The net proceeds will be used for repayment of borrowings of the firm and its subsidiaries, payment of interest and general corporate purposes.
Moneycontrol has reviewed a copy of the DRHP.
According to the DRHP, Samhi Hotels has “the third largest inventory of operational keys (owned and leased) in India as of February 28, 2023 (Source: JLL Report).”
“Within 12 years of starting our business operations, we have built a portfolio of 3,839 keys across 25 operating hotels in 12 of India’s key urban consumption centres, including Bengaluru, Hyderabad, National Capital Region, Pune, Chennai and Ahmedabad, as of February 28, 2023. All of our hotels are in the Upper Upscale and Upscale, Upper Mid-scale and Mid-scale hotel segments. Our hotels typically operate under long-term management contracts with established and well-recognised global hotel operators such as Marriott, Hyatt and IHG,” the DRHP says.
The DRHP adds, “We have adopted an acquisition-led strategy, which is underpinned by our track record of acquiring and successfully turning around hotels to grow our business. Our dominant position among the Upper Mid-scale and Mid-scale brands in India enabled us to grow our Fairfield by Marriott and Holiday Inn Express portfolio to 936 and 1,427 keys, respectively, as of February 28, 2023, making us the largest owner of these brands in India.”
JM Financial and Kotak Mahindra Capital are the investment bankers working on the deal.
Law firms Shardul Amarchand Mangaldas and Indus Law advised Samhi Hotels and the banks, respectively while J Sagar Associates, Khaitan and Co, Cyril Amarchand Mangaldas and AZB & Partners are the legal advisors for the investors.
Moneycontrol could not elicit an immediate response from Samhi Hotels, the i-bankers and the law firms.
According to recent media reports, Appeejay Surrendra Park Hotels may also look to re-file papers with Sebi and float an IPO later this year.