Barbeque Nation IPO opens for subscription today, garners Rs 203 Cr from anchor investors

The Initial Public Offering (IPO) for casual dining chain Barbeque Nation Hospitality opens for subscription today and will continue until March 26. The company is planning to raise Rs 452.87 crore through its public issue at the higher end of the price band Rs 498-500 per share.

Barbeque Nation on Tuesday raised Rs 203 crore from anchor investors ahead of its initial share-sale, and the company's IPO committee has decided to allocate 40,57,861 shares at Rs 500 apiece to 21 anchor investors.

At this price, the company raised Rs 202.89 crore, according to a statement.

The anchor investors include Goldman Sachs India Ltd, Nomura Funds Ireland Public Limited Company, Fidelity Investment Trust, SBI Mutual Fund (MF), ICICI Prudential MF, Kotak MF, Aditya Birla Sunlife MF, HDFC MF, HDFC Life Insurance Company, Kuber India Fund, Pioneer Investment Fund, and UPS Global Trust.

The initial public offer comprises fresh issue of shares worth Rs 180 crore and an offer-for-sale of up to 54,57,470 equity shares.

Equity shares aggregating up to Rs 2 crore have been reserved for eligible employees.

At the upper end of the price band, the IPO is expected to fetch Rs 453 crore.

The company has already raised Rs 150 crore through a pre-IPO placement from Xponentia Capital and Jubilant Foodworks.

Proceeds of the fresh issue will be utilised to fund the company's capital expenditure for expansion, besides prepayment or repayment of certain borrowings and expenses related to general corporate purposes.

The company is promoted by Sayaji Hotels, Sayaji Housekeeping Services, Kayum Dhanani, Raoof Dhanani, and Suchitra Dhanani. It is backed by private equity firm CX Partners, which made its first investment in 2013 and again in 2015.

The promoters hold a 60.24 percent stake, CX Partners owns 33.79 percent, and Jhunjhunwala's investment firm Alchemy Capital holds 2.05 percent in the company.

The total operating revenue of the company in FY20 was Rs 850.8 crore and the CAGR from FY17 to FY20 was at 19.5 percent.

Barbeque Nation Hospitality, which filed preliminary papers in February last year, received Sebi's approval in July 2020 to float the IPO.

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Barbeque Nation IPO to open on Wednesday; sets price band at Rs 498-500 per share

The issue is being managed by IIFL Securities, Axis Capital, Ambit Capital, and SBI Capital Markets. Barbeque Nation Hospitality owns and operates Barbeque Nation Restaurants. It also operates Toscano restaurants and UBQ by Barbeque Nation Restaurant.

As of December 2020, Barbeque Nation Hospitality operated 147 outlets across India and six outlets across three countries — the UAE, Oman, and Malaysia.

Earlier in 2017, the company had filed IPO papers with Sebi seeking to raise Rs 700 crore. However, the regulator kept the processing of the company's proposed IPO in abeyance "pending regulatory action for past violations".

It finally approved the IPO plan in January 2018. However, the company could not launch the initial share-sale due to adverse market conditions.