CX set for partial exit as Matrix Cellular files for India IPO
Matrix Cellular, an Indian telecommunications company that caters to people traveling abroad, has filed for an IPO. This would allow a partial exit for private equity backer CX Partners.
The company plans to sell 15.17 million shares, of which 12.36 million are held by CX. The rest will be sold by the promoters, the Dugal family. The draft red herring prospectus does not give any information regarding the pricing of the offer, although the Economic Times reported that Matrix was looking to raise INR5 billion ($78.5 million).
Founded in 2011, the company is the largest provider of SIM cards offering voice, data and SMS services to outbound travelers from India. Matrix issues SIM cards and sets up plans prior to departure through a distribution network comprising sales counters at five airports in India and branch offices in 13 cities nationwide. Purchases can also be made online and SIM cards are delivered to customers.
The company enters into agreements with local telecom providers in destination countries and makes bulk purchases of voice, data and SMS services, as well as country-specific SIM cards. As of December 2014, it had relationships with 41 providers, including Singapore's SingTel, China Telecom and UK-based EE. Matrix's customer base ranges from corporates and their employees to individual travelers.
CX committed approximately INR1.57 billion to the company in 2011, acquiring shares from the Dugal family and from early investor Bennett Coleman & Co. The PE firm currently holds 15.89 million shares in total, which equates to a 37.82% interest. The promoters between them have 61.42%.
Matrix reported total revenue of INR2.44 billion for the year ended March 2014, down from INR2.66 billion in the previous 12-month period. Net profit fell from INR311.4 million to INR48.5 million, although for the first nine months of the current financial year profit has revived to INR146.5 million.
CX, which was set up by Ajay Relan, formerly India head at CVCI, closed its debut fund at $515 million in 2010 and is currently in the market with a successor vehicle.
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