Ratan Tata to offload all 77,900 shares in FirstCry IPO

Business tycoon Ratan Tata will sell all his 77,900 shares in the upcoming initial public offering (IPO) of e-commerce platform FirstCry. Tata had picked up a 0.02 per cent stake for ₹66 lakh in Brainbees Solution in 2016, which operates omnichannel businesses of kidswear under the brand name FirstCry.

According to the draft red herring prospectus (DRHP) filed by Brainbees Solutions, the parent company of FirstCry to capital markets regulator Securities and Exchange Board of India (SEBI), the IPO comprises of issuance of fresh equity shares worth ₹1,816 crore as well as an offer for sale by existing shareholders and promoters. 

Also Read: Firstcry IPO: Issue details, objectives, and more - 10 key things to know from DRHP

Existing investors, including Mahindra & Mahindra (M&M), private equity firm TPG, NewQuest Asia, and SoftBank, are planning to collectively sell 5.44 crore shares in Brainbees through an Offer for Sale (OFS) alongside the primary issue.

SoftBank holds the largest stake in FirstCry, 25.5 percent, making it the primary shareholder in the online e-commerce unicorn. According to the document, Mahindra will sell its 0.58 per cent stake in the parent company; SoftBank will offload 2.03 crore shares.

The DRHP also said that FirstCry may consider a private placement of shares to certain investors for up to ₹363.20 crore. FirstCry offers toys, apparel and accessories for babies, kids and mothers through online and physical stores.

Firstcry has not announced the opening and closing dates for the IPO subscription yet in its DRHP, however, several media reports claim that the public issue will open in early 2024. The offer price for the issue and IPO price band have also not been announced so far.

As per the DRHP, net proceeds will be used to set up new retail stores, warehouses and international expansion. Kotak, Morgan Stanley, Bofa Securities, JM Financial and Avendus are the book-running lead managers, and Link Intime India Private Limited is the registrar of the offer.