A day after Tata Group¡¯s former chairman?Ratan Tata?turned 86 on his birthday, it has been revealed that he will sell his stake in childcare products startup FirstCry?when the company goes public through its upcoming?IPO?soon.
Ratan Tata had picked up a 0.02% stake for Rs 66 lakh in Brainbees Solution, which operates under the brand name FirstCry, in the year 2016.
The average cost of acquisition of shares by Tata comes to Rs 84.72 per share, as per FirstCry's draft red herring prospectus (DRHP) filed with the market regulator Securities and Exchange Board of India (SEBI). His total investment in the company, therefore, comes to about Rs 66 lakh.
While the exact date is not yet known, Ratan Tata-backed?FirstCry is aiming to launch its?IPO in the early months of 2024. The company, which saw its losses widen six-fold in fiscal 2022-2023 due to rising costs, said it would?use funds from the IPO?to expand stores in India and Saudi Arabia and to clear its leases for existing Indian stores.
In the next three fiscal years, it plans to set up 336 new stores measuring an aggregate of approximately 0.59 million square feet under the BabyHug brand. It also plans to add another 147 stores, measuring approximately 0.51 million square feet, under the FirstCry brand and other home brands.
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While the size of the FirstCry IPO is not yet known,?it includes a fresh issue of shares worth up to Rs 1,816 crore. The offer for sale (OFS) part includes offloading up to 54.4 million shares by existing investors like SoftBank, Mahindra & Mahindra (M&M), and US private equity fund TPG.
SoftBank-operated SVG Frog is selling 2.03 crore shares, while M&M plans to sell up to 28.06 lakh shares of the company in the IPO.
Other selling shareholders include PI Opportunities Fund, TPG, NewQuest Asia, Apricot Investments, Valiant Mauritius Partners, TIMF Holdings, Think India Opportunities Master Fund, and Schroders Capital Private Equity Asia, as per the ET report.
SoftBank is FirstCry's biggest shareholder?and holds a 25.5% stake in the startup, followed by M&M's 10.98% stake. Among other individual shareholders, FirstCry Co-Founder and CEO Supam Maheshwari is divesting 18.24 lakh shares out of 2.89 crore shares in his pocket. Ahead of the IPO, Maheshwari held a 5.95% stake in the company.
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