Akash Jha
Zaggle Prepaid Ocean Services, a FinTech-SaaS startup, has received Rs 73 crore via private placement in preparation for an IPO.
The business informed investors on August 18 that it has completed the pre-IPO placement of 44.51 lakh equity shares at an issue price of Rs 164 per share, after consulting with merchant bankers.
On August 10 the board of directors for the financial technology products and services provider approved the pre-IPO placement, and on August 11 the shareholders did the same.
Further, the board of directors of the SaaS company passed a resolution on August 16 allocating 44.51 lakh shares to six investors, including Ashish Rameshchandra Kacholia, Bengal Finance and Investment, Himanshi Kela, Absolute Returns Scheme, Vikasa India EIF I Fund – Incube Global Opportunities, and Acintyo Investment Fund PCC – Cell 1.
Ashish Kacholia and Bengal Finance & Investment are the two largest investors in Zaggle Prepaid Ocean Services, each purchasing 30 crore shares in advance of the company’s first public offering.
Zaggle, a market leader in expenditure management with a unique selling point and broad customer base, was given the green light by Sebi, India’s capital markets regulator, in April to launch an initial public offering.
The first public offering is an effort to raise around Rs 663 crore for the company. The IPO share price of Rs.164 is used to determine the total amount that can be raised.
There will be a new issuance of shares worth Rs 490 crore, and the promoters and investors will be offering for sale (OFS) 1.05 crore equity shares. According to the company’s prospectus, the size of the new issuance is expected to decrease from the existing level of Rs 490 crore to a more manageable Rs 417 crore.
The overall size of the Zaggle IPO offer might be around Rs 590 crore if the planned reduction in the size of the fresh offering is assumed.
The company’s promoters, Raj P Narayanam and Avinash Ramesh Godkhindi, will sell 15.3 million shares each in an OFS, while the company’s largest public shareholder, Zuzu Software Services, with an 18.95 percent stake, will sell 17.65 million shares.
Among the IPO’s selling stockholders, VenturEast Proactive Fund LLC is selling 28.3 million shares and GKFF Ventures is selling 20.46 million shares. Koteswara Rao Meduri, Malvika Poddar, and the Ventureast Trustee Company are some of the other selling stockholders.
Profitable for the last three fiscal years, Zaggle plans to use the fresh issue proceeds to invest in customer acquisition and retention (Rs 300 crore), technology and product development (Rs 40 crore), and debt repayment (Rs 18 crore).
The high-margin SaaS company is one of only a handful of market leaders delivering such a wide range of financial technology solutions.
ICICI Securities, Equirus Capital, IIFL Securities, and JM Financial are acting as the issue’s merchant bankers, and KFin Technologies is serving as the offer’s registrar.
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