Samvardhana Motherson Finance (SMFL) has reportedly withdrawn its initial public offer (IPO) due to poor demand. The company's IPO was subscribed 23% by 17:00 IST on the last day of the bidding for the issue today, 4 May 2012. The IPO got bids for 2.95 crore shares. The price band for SMFL's IPO was Rs 113-118 per share.
SMFL had raised Rs 222 crore by issuing shares to anchor investors on 30 April 2012. The company allotted 1.93 crore shares to anchor investors at a price of Rs 115 each. The company sold shares to funds including Birla Sun Life Mutual Fund, Government of Singapore, Royal Bank of Scotland PLC, IVY Pacific Opportunities Fund.
The IPO consisted of fresh issue of equity shares worth Rs 1344 crore and offer for sale by Radha Rani Holdings PTE worth Rs 321 crore.
The company had decided to use the proceeds of the IPO towards prepayment and repayment of debt facilities of the company and some of its subsidiaries worth Rs 338.50 crore, strategic investments in Samvardhana Motherson Polymers and Samvardhana Motherson Holding (M) worth Rs 627.50 crore, investments in rear view vision systems business, i.e., SMR worth Rs 156 crore (meet capex requirement) and balance towards general corporate purposes.
SMFL, incorporated in 2004, is a holding company of Samvardhana Motherson Group (SMG). The Group predominantly focuses on a range of auto components such as wiring harnesses, rearview mirrors, molded plastic parts, injection molding tools, assemblies and modules, elastomer products, cutting tools and thin film coating metals, IT services, design engineering, cabins for off-highway vehicles etc. It has presence in 25 countries with 120 plants across the globe.
On consolidated basis, SMFL reported a net loss of Rs 152.79 crore on sales of Rs 5957.47 crore for the nine months ended December 2011.