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MT Educare Ltd to use Rs.20 crore to pre-pay debt of its subsidiary CLIP

Franchise India Bureau
Franchise India Bureau Sep 29 2017 - 2 min read
MT Educare Ltd to use Rs.20 crore to pre-pay debt of its subsidiary CLIP
CL Educate’s Rs 238.95 crore ($36.10 million) IPO will comprise a fresh issue of 2.18 million shares besides an offer for sale (OFS) of nearly 2.58 million shares.

New Delhi-headquartered education services company, CL Educate Ltd, is seeking a valuation of Rs 708.84 crore ($107.11 million) through an initial public offering that opens next week.

The IPO will begin on 20 March and close on 22 March.

The anchor book will open one business day prior to the date of opening of the public issue. The company has fixed the price band at Rs 500-502 per share for its public offering, which will see its private equity backer, Gaja Capital, making a part-exit. Besides, the promoter, promoter-group individuals and institutional shareholders are also expected dilute their stakes in the company.

CL Educate’s Rs 238.95 crore ($36.10 million) IPO will comprise a fresh issue of 2.18 million shares besides an offer for sale (OFS) of nearly 2.58 million shares.

It will see a dilution of 33.61% stake on post-offer basis. CL Educate, best known for its test prep brand Career Launcher, will be the first education services startup to float an IPO in the past five years.

MT Educare Ltd will also use about Rs 20 crore to pre-pay a debt of its subsidiary Career Launcher Infrastructure Private Ltd (CLIP). Besides, it will earmark about Rs 25 crore for acquisitions and strategic initiatives as well as for general corporate purposes. In September 2014, CL Educate had sought a valuation of $130-140 million of a proposed IPO.

Gaja Capital, the Mumbai-based private equity firm, will part-exit through the sale of 0.6 million shares, or 0.42% stake, in the company. Gaja Capital first acquired CL Educate shares a decade ago and owns about 1.24% stake. It has invested Rs 74.15 crore. Through the partial exit, the PE firm will fetch Rs 30 crore.

The IPO will also see CL Educate’s chairman and executive director, Satya Narayanan R, as well as vice chairman and managing director, Gautam Puri, sell one-third of their holdings. Merchant Banker Kotak Mahindra Capital is the sole financial advisor to the IPO.

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