Topsgrup to raise Rs 150-200 cr via PE placements

A deal, to also give an exit option to its current investors, likely to be closed in six months

Security solutions provider Topsgrup is looking to raise Rs 150-200 crore from private equity investors. A deal, which will also provide exit options to existing investors — Rakesh Jhunjhunwala, ICICI Ventures and Everstone Capital — is likely to be closed over the next six months, according to Topsgrup Vice-Chairman & Chief Executive Ramesh Iyer. The company’s founders might also dilute a minority stake in the process.

Topsgrup is also looking at acquisitions in the domestic market. Companies engaged in guarding services and security technology could be targets. Over the next couple of years there could be two-three acquisitions, worth Rs 200-300 crore, Iyer said.

“Over the next few years, we plan to grow both organically and inorganically and become a $1-billion company. There will be acquisitions in our existing markets — India and the UK. We’ll first consolidate our business in these two geographies and then venture into other markets,” he added.

In 2008, Topsgrup had acquired a 51 per cent stake in The Shield Guarding Company, a UK-based security service provider, for about Rs 125 crore. The same year, it had bought Bengaluru-based Guardwell Detective Services Pvt Ltd for an undisclosed sum. It had also acquired a 14.69 per cent stake in Chennai-based security systems integrator Adtech Systems.

TopsSecurity Ltd, the flagship of Topsgrup, had become the first security firm in India to receive private equity funding in 2007, when ICICI Venture invested Rs 115 crore for a 13.69 per cent equity stake and Indivision made an additional investment of Rs 25 crore. Stock investor Rakesh Jhunjhunwala also owns a stake in the company. Everstone Capital also owns equity in the company. The private equity investors and Jhunjhunwala together hold a 32 per cent stake in the company.

At present Topsgrup is the second-biggest player in the domestic security market, next only to Group4Securitas.

Iyer said while man guarding would continue to be his company’s largest revenue contributor, other verticals like electronic security, emergency response, investigation and background check were also growing fast.