Ahead Of IPO, Fusion Micro Finance Garners Rs 331 Crore, From Anchor Investors

Fusion Micro Finance on Tuesday said it has raised a little over Rs 331 crore from anchor investors ahead of its initial public offering (IPO) that opens for public subscription on Wednesday. The company has decided to allot 89,99,943 equity shares to anchor investors at Rs 368 apiece, aggregating the transaction size to Rs 331.2 crore, according to a circular uploaded on the BSE's website. Nomura, BNP Paribas Arbitrage, Aditya Birla Sun Life Mutual Fund, ICICI Prudential Mutual Fund, Edelweiss Mutual Fund, Motilal Oswal Mutual Fund, HDFC Life Insurance Company, Bajaj Allianz Life Insurance Company and Kotak Mahindra Life Insurance Company are among the anchor investors, it added.

The IPO comprises fresh issuance of equity shares worth Rs 600 crore and an offer of sale of 13,695,466 equity shares by promoters and existing shareholders. Those selling shares in the OFS are -- Devesh Sachdev, Mini Sachdev, Honey Rose Investment Ltd, Creation Investments Fusion, LLC, Oikocredit Ecumenical Development Co-operative Society U.A and Global Financial Inclusion Fund. The issue, with a price band of Rs 350-368 a share, will open for public subscription on November 2 and conclude on November 4.

The company is expected to raise Rs 1,104 crore through the upper end of the price band. Half of the issue size has been reserved for qualified institutional investors, 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors. Investors can bid for a minimum of 40 shares and in multiples thereof. Net proceeds of the fresh issue will be used to augment the capital base of the microfinance firm.

The New Delhi-based microfinance company claims to provide financial services to underserved women across India in order to facilitate their access to greater economic opportunities. The company uses a joint liability group (JLG) model, developed by Grameen Bank in Bangladesh, to give loans of up to Rs 50,000. In December 2018, Warburg had invested Rs 520 crore in the company which achieved a 45 per cent growth in assets under management in 2018-19 financial year and had an outstanding portfolio of Rs 3,350 crore as of December 2019. ICICI Securities, CLSA India, JM Financial and IIFL Securities are the merchant bankers to the issue.

(PTI)