PE investors to make partial exits from India's AGS, S.H. Kelkar

AGS is seeking to raise up to INR13.5 billion ($215.5 million), comprising INR4 billion in new equity and INR9.5 billion in shares sold by existing shareholders, according to a filing. TPG will exit shares worth up to INR5.51 billion, with Actis and the promoters selling INR3.49 billion and INR500 million, respectively.

The company has yet to disclose how many shares it will offer and at what price.

TPG has a 25.96% stake in AGS. It made three investments in the company, purchasing INR200 million in equity shares from the promoter in May 2011 and then subscribing to compulsorily convertible preference shares (CCPS) in two batches - the first worth INR1.25 billion in June 2011 and the second worth INR450 million in March 2012.

Actis owns 19.79%, having committed INR1.7 billion for a combination of equity shares and CCPS in August 2012. Both TPG and Actis converted their CCPS in February 2015. The promoter, Ravi Goyal, holds a 55.2% interest in AGS.

The company provides payment solutions and technology products to the banking, retail and petroleum sectors. As of December 2014, it had supplied and installed over 25,000 ATMs for 70 banks, including ICICI Bank, Axis Bank, HDFC Bank and State Bank of India. It was responsible for outsourcing and managing more than 16,000 ATMs.

AGS also provides a variety of cash management and transaction switching services, as well as supplying point of sale terminals in retail outlets, automating gas stations and installing dispensing machines.

The company reported revenue of INR9.5 billion for the 12 months ended March 2014, up from INR6.4 billion the previous year. Net profit rose from INR82.9 million to INR146.9 million over the same period.

Meanwhile, Blackstone will sell up to 13.22 million shares in S.H. Kelkar for an as yet unspecified sum, while one of the promoters, Prabha Ramesh Vaze, offloads 2.34 million shares. The Indian company also plans to raise INR2 billion in new equity, it was disclosed in a filing.

The private equity firm invested INR2.43 billion in S.H. Kelkar in 2012 via two vehicles.

S.H. Kelkar is one of India's largest fragrance and flavor producers by revenue, with a market share of around 12% as of year-end 2013, according to Nielsen. It exports fragrance products to 49 countries and flavors to 17 countries.

Fragrances are used as raw materials in personal wash, fabric care, skin and hair care products, as well as in fine fragrances. Customers include Godrej consumer Products, Marico, Wipro Consumer Care & Lighting, and Unilever. S.H. Kelkar supplies flavors to the likes of Britannia India, Vadilal Industries and Ravi Foods for use in baked goods, dairy products, beverages and pharmaceuticals.

Revenue came to INR4 billion in 2014, up from INR3.4 billion the previous year. Net profit rose from INR215.6 million to INR439.8 million.

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• Topics
• Exits
• South Asia
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• Financials
• IPO
• The Blackstone Group
• Actis Capital
• TPG Capital
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