Warburg Pincus-backed Avanse Financial Services files fresh draft papers with SEBI to raise ₹3,500 crore via IPO

Avanse Financial Services Ltd has filed fresh draft red herring prospectus (DRHP) with the capital market regulator, Securities and Exchange Board of India (SEBI), for an initial public offering (IPO). Due to technical reasons, SEBI recently, returned the IPO documents, as per news reports. Refiling their prospectus was at the firms' discretion.

With a focus on education, Avanse Financial Services Limited is an Indian non-banking financial organisation (NBFC). As to the Crisil study, the organisation provides a comprehensive education stack, encompassing loans for student education as well as education infrastructure loans, which act as growth capital for educational institutions.

The company's promoter, according to the Draft Red Herring Prospectus (DRHP), is Olive Vine Investment Ltd., a Warburg Pincus subsidiary. Among the institutional shareholders are affiliates of International Finance Corporation, Mubadala Investment Company, Avendus Future, and Kedaara Capital.

With a total value of ₹3,500 crore, the public offer consists of a new issue of equity shares up to ₹1,000 crore and an offer for sale (OFS) of up to ₹2,500 crore by the "Selling Shareholder" with a face value of ₹5 per equity share.

Equity shares from International Finance Corporation (an investor selling shareholder) up to ₹342 crore, equity shares from Kedaara Capital Growth Fund III LLP (an investor selling shareholder) up to ₹400 crore, and equity shares from Olive Vine Investment Ltd (a promoter selling shareholder) up to ₹1,758 crore are all on offer for sale.

As of the date of the DRHP (July,31), the promoter holds 149,394,074 Equity Shares of face value of ₹5 each, comprising 58.38% of the pre-Offer issued, subscribed and paid-up equity share capital of the company on a fully diluted basis.

In order to meet the company's future capital requirements resulting from the expansion of its business and asset base, Avanse Financial Services Limited plans to use the Net Proceeds to increase its capital base.

The book running lead managers for the issue are Kotak Mahindra Capital Company Limited, Avendus Capital Private Limited, J.P. Morgan India Private Limited, Nomura Financial Advisory and Securities (India) Private Limited, Nuvama Wealth Management Limited (previously known as Edelweiss Securities Limited), and SBI Capital Markets Limited.

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