Chennai-based Northern Arc Capital has secured Rs 229 crore from top anchor investors before its upcoming Initial Public Offering (IPO). The company, a well-known non-banking financial institution, aims to expand its business with this new funding. The shares were allotted at Rs 263 per share, which is the upper end of the price band, as per a notice from the Bombay Stock Exchange (BSE).
Notable Investors Involved
Some major investors involved in this transaction include:
- SBI General Insurance Company
- SBI Life Insurance Company
- Reliance General Insurance Company
- Kotak Mahindra Life Insurance Company
- Goldman Sachs (Singapore) Pte
- Societe Generale
- Quant Mutual Fund
These investors have collectively purchased 87.02 lakh equity shares, further boosting Northern Arc Capital’s financial stability ahead of its IPO.
Details of the IPO
Northern Arc Capital’s IPO will open for public subscription from September 16 to September 19, 2024. The price for each share is set between Rs 249 and Rs 263.
The IPO will raise Rs 777 crore, out of which:
Rs 500 crore will come from the fresh issue of shares.
An Offer for Sale (OFS) of 10,532,320 equity shares, worth Rs 277 crore, will be conducted by existing investors. The investors selling their shares include:
- Leapfrog Financial Inclusion India
- Accion Africa-Asia Investment Company
- Eight Roads Investments
- Sumitomo Mitsui Banking Corporation
- Dvara Trust
Purpose of Fundraising
The funds raised through the IPO will help Northern Arc meet its capital requirements, especially for onward lending. The company has a strong focus on lending to underserved households and small businesses across India.
Northern Arc Capital has already raised significant funds this year, including $75 million from the Dutch entrepreneurial development bank (FMO) and $80 million from the International Finance Corporation (IFC), part of the World Bank Group.
About Northern Arc Capital
Founded by Ashish Mehrotra, Northern Arc Capital provides financial services to microfinance institutions (MFIs), micro, small, and medium-sized enterprises (MSMEs), and Indian households. The company has facilitated over Rs 1.73 lakh crore worth of loans and reached more than 10.18 crore individuals.
For the fiscal year ending March 2024, Northern Arc reported a revenue of Rs 1,906.03 crore and a net profit of Rs 317.69 crore.
The IPO is being managed by ICICI Securities, Axis Capital, and Citigroup Global Markets India. Kfin Technologies is the registrar for the issue. The shares are expected to be listed on the BSE and NSE by September 24, 2024.
