[Funding alert] Online travel firm MakeMyTrip to raise $200M through debt securities issuance
Gurugram-based online travel firm MakeMyTrip on Friday announced that it will raise $200 million (over Rs 1,450 crore) through the issue of senior convertible notes.
According to the official announcement, "the pricing of $200 million in aggregate principal amount of 0.00 percent convertible senior notes due 2028". The notes offering was upsized from $175 million, it added.
Speaking about the development, Mohit Kabra, CFO, MakeMyTrip Group, stated,
"While the travel industry is in the midst of very difficult times, we are pleased with the overwhelming response to our convertible bond offering. This raise will bolster our cash reserves, allowing us to meet the working capital requirements as the business recovery gathers momentum and also pursue any investment opportunities in the growing Indian market".
This raise at zero coupons and conversion premium of 37.5 percent reflects global investors' appetite to invest behind strong Indian brands and businesses, Mohit added.
MakeMyTrip Founder Deep Kalra
Further, according to the company statement, the notes will not bear regular interest, and the principal amount of the notes will not accrete. The notes will mature on February 15, 2028, unless earlier redeemed, repurchased, or converted in accordance with their terms before such date.
The notes will be convertible into the company's ordinary shares at the holders' option at any time before the close of business on the second business day immediately preceding the maturity date.
The company intends to use the net proceeds for working capital and other general corporate purposes, MakeMyTrip said.
As of December 31, 2020, the balance of cash and cash equivalents and term deposits on MakeMytrip's balance sheet was $227.6 million.
In April 2020, the startup had received an infusion of Rs 73.5 crore from its Mauritius-based entity (MakeMyTrip Limited, Mauritius) in two tranches, according to Ministry of Corporate Affairs filings of the company. Both the filings are reported for the month of March.