Was told by Sebi to do so to reflect revision in shareholding; to reapply in 6 weeks.
Super Religare Laboratories (SRL) has withdrawn its initial public offering (IPO) prospectus, after an order from the Securities and Exchange Board of India (Sebi) to do so, since the shareholding pattern of the diagnostic chain had changed.
SRL, founded by billionaire brothers Malvinder and Shivinder Singh, had filed its draft red herring prospectus (DRHP) with Sebi on February 15. In April, Fortis Healthcare, also controlled by the Singh brothers, received in-principle approval to acquire a strategic stake in SRL. On May 12, Fortis completed the acquisition of 74.59 per cent stake from the SRL promoters for Rs 803 crore. This has made Fortis the new promoter of SRL instead of the Singh brothers.
SRL also did pre-IPO placements with two private equity (PE) companies after filing its DRHP in February. In April, Avigo Capital Partners picked up 9.27 per cent in SRL for about Rs 100 crore. Another PE firm, Sabre Partners, invested Rs 50 crore early this month to acquire about four per cent. Logos Holding, Prime Trust and Religare Group companies hold the remaining stake.
The regulator has asked SRL to incorporate the latest changes in its shareholding pattern and file a new DRHP, according to an official familiar with the matter. Nomura Financial Advisory & Securities, lead manager of the SRL issue, accordingly withdrew the earlier DRHP, via a letter dated May 9, the Sebi website showed. Kotak Mahindra Capital and Religare Capital Markets are the other two book running lead managers for the issue.
“As a result of Fortis Healthcare becoming controlling shareholder of SRL, the company has withdrawn its current DRHP application for making necessary revisions and changes in the relevant parts of the DRHP to reflect the revised ownership pattern,” said Sanjeev Chaudhry, chief executive officer at SRL, in reply to an e-mail query. “The company proposes to re-submit the revised DRHP application with an update of its financial results for the financial year ended March 31 in the next four to six weeks.”
More From This Section
In the DRHP filed in February, the company wanted to come out with an IPO of 28 million shares, which would have amounted to 35 per cent of the fully-diluted, post-issue, paid-up capital. At that time, SRL had said it was considering pre-IPO private placement of eight million shares, which would reduce the offering to 25 per cent of the post-issue paid-up capital.
By the latest Fortis deal, SRL should be able to raise at least Rs 270 crore from its IPO. SRL is likely to be the first diagnostic chain to get listed on Indian bourses. Last year, it had acquired Piramal Diagnostic Services for Rs 600 crore, to became the largest diagnostic company in the Rs 9,000-crore per year Indian diagnostic services market.
As of December 31, 2010, SRL and Piramal Diagnostic were running eight reference laboratories, 181 network laboratories, 15 wellness centers and 888 collection centers. The entity performs a little over 33,000 tests per day and catered to about 4.2 million customers during the nine months ended December 31, 2010.