VA Tech Wabag Eyes Acquisitions Rs 500 cr IPO in 3 Mths (28-Jun-2010)
As per a top official of Water and waste management company, VA Tech Wabag, it is intending to make acquisitions in both domestic and overseas markets and also plans to initiate its IPO of Rs 500-crore in the next three-months.
VA Tech Wabag's Managing Director, Rajiv Mittal revealed that, company has approached market regulator SEBI for approving its IPO and is expecting to receive the approval in near future. Company is also expected to initiate IPO in the next three months.
Further, some of the existing stakeholders in the company such as ICICI Venture, Passport Capital and GLG of the UK, are expected to dilute their stakes in the company.
Commenting on dilution of stake Mittal clarified that promoters are not intending to diminish their stakes and also informed that further details will be disclosed after receiving SEBI's.
Further, Mittal denied commenting on the reports of ICICI Venture divesting 10 per cent of its stake in the firm.
Mittal further added that funds raised will be utilized for acquisitions and also enhance investments in build, own, operate, transfer (BOOT) projects. Besides, a potion will also be used for working capital purposes and for establishment of corporate office in Chennai. While commenting on the intended acquisition, Mittal said company is interested to make acquisition in emerging markets rather in the developed one. China and markets in Asia and Africa are considered for acquisition.
The acquisitions would be made in the water treatment segment and must be in line with VA Tech Wabag's culture and business strategy.
As company has immense cash surplus funding will not be an obstacle for acquisition, further if opportunities surface, company may even carry out multiple buys.
In addition to acquisition, company is also intending to invest in BOOT projects. Besides, it will be spending around Rs 45-crore to establish a corporate office in Chennai, which is expected to be completed by the end of next year. At present, ICICI Venture holds a 31 per cent stake in the company, while the promoters holds 38 per cent, other investors comprising of venture capital firms has 30 per cent stake, whereas independent directors and others hold 1 per cent stake.
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