 "Sai Silks IPO to offer safety net to retail investors")
Prior to Sai Silks, Usher Agro had offered safety net to investors when it came out with its IPO in 2006.
The Hyderabad-based company, which is primarily into women's ethnic wear business, would offer a safety net scheme to its prospective retail investors for six months after the close of the issue.
Under the safety net scheme, if the market value of the shares falls below the issue price at any time during scheme period, promoters would buyback shares at the sale price from original allottees. However, the buyback would be subject to a maximum of 1,000 equity shares per allottee.
The safety net mechanism is still under discussion and has not been made mandatory by the market regulator Sebi.
The company is aiming to garner Rs 89 crore with initial public offering (IPO) shares in the price band of Rs 70-75 apiece. The issue would close on February 13.
The proceeds from the share sale would be utilised for setting-up retail outlets, brand promotion activities, term loan repayment and meeting working capital requirements.
The shares are proposed to be listed on the BSE and the National Stock Exchange.
The book-running lead managers to the issue are Ashika Capital Ltd and Vivro Financial Services Pvt