₹441 cr. raised via IPO to help retire debts; MD Shah to have 58% equity post OFS
Diagnostics company Metropolis Healthcare Ltd., on Monday, listed on the stock exchanges at ₹960, at a 9% premium to the allotment price of ₹880 per share, before closing at ₹959.55.
Besides providing good returns for investors, the listing also proved to be rewarding to managing director Ameera Shah’s efforts to thwart a hostile bid to take over the company in 2016.
According to Hurun Report India, Ms. Shah owns 0.36% share in Metropolis Healthcare directly, and 28.86% indirectly through her 99% ownership in Metz Advisory LLP.
Based on the above ownership information and listing price of ₹960, Hurun Report estimates Ms. Shah’s networth at ₹1,500 crore.
In 2016, Ms. Shah had to borrow ₹600 crore from private equity major KKR at very high interest rates to provide the mandated exit to another private equity investor Warburg Pincus, which had 27% stake in the company, and to acquire majority stake in Metropolis.
“In 2015, when we decided to restructure the organisation, we found that between 2001 and 2015 we had a board that was not aligned. The company suffered the maximum during that period,” Ms. Shah told.
“The shareholding was not clean. There was no operating control at the board level,” she added. Ms. Shah said there was no other option but to take the debt though it was very risky. “There could have been a pile up of debt and the company could have landed in litigation,” she said.
Through the initial public offering (IPO), her father and company chairman Dr. Sushil Shah, mobilised around ₹441 crore, which will go for retiring a majority of the debt.
“Even after the [Offer for Sale] OFS, we will be having 58% equity in the company, which was 36% three years ago,” Ms. Shah said.