Cadila-backed city gas distribution firm IRM Energy is set to launch its initial public offering (IPO) on October 18, being the first in the current month. The fundraising amount via IPO may be around Rs 550 crore, as per the market sources.
The price band will be announced by the company tomorrow.
The anchor book of the offer will be opened for a day on October 17, while the issue will close on October 20, as per the red herring prospectus.
The IPO of 1.08 crore equity shares comprise only a fresh issue portion by the company and there is no offer-for-sale (OFS) component.
Hence, the entire issue proceeds, excluding IPO expenses, will go to the company.
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The capital expenditure requirements of Rs 307.26 crore for development of the city gas distribution network in the geographical areas of Namakkal and Tiruchirappalli (Tamil Nadu) in FY24 (last four months), FY25, FY26 and FY27 (first half) will be funded via issue proceeds.
Further, the company will repay its debt amounting to Rs 135 crore via IPO money, and the remaining funds will be kept for general corporate purposes.
IRM Energy has reserved 2.16 lakh equity shares for its employees. Half of the net offer size (excluding employee shares) will be reserved for qualified institutional buyers, 15 percent for high networth individuals, and the remaining 35 percent for retail investors.
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Promoters - Cadila Pharmaceuticals, and IRM Trust hold 67.94 percent shares in the company, while the rest of stake is held by public shareholders including Enertech Distribution Management (28.65 percent shares) and Shizuoka Gas Company (2.94 percent).
The city gas distribution company with operations in Banaskantha (Gujarat), Fatehgarh Sahib (Punjab), Diu & Gir Somnath (Union Territory of Daman and Diu/Gujarat), and Namakkal & Tiruchirappalli (Tamil Nadu), distributes CNG for use in motor vehicles and PNG for use by domestic households as well as for commercial and industrial units.
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HDFC Bank, and BOB Capital Markets are the merchant bankers to the issue, while Link Intime India is the registrar to the offer.
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