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Chemspec Chemicals, Northern Arc Capital receives Sebis nod for IPO

Chemspec Chemicals and Northern Arc Capital have received approval from Sebi Capital Markets Authority to raise funds through initial stock sales.

The two companies filed their preliminary IPO papers with the Securities and Exchange Board of India (Sebi) in July.

Chemspec Chemicals and Northern Arc Capital received the regulator’s observations on August 30 and September 3, respectively, an update with Sebi showed on Monday.

In Sebi parlance, the publication of observations means approval for an initial public offering (IPO).

The IPO of Chemspec Chemicals in the amount of 700 billion rupees is according to the draft of the Red Hering Prospectus (DRHP) exclusively an offer to sell by promoters.

BACS LLP will offer shares valued at Rs 233.40 billion as part of the sale offer, while Mitul Vora and Rushabh Vora will each offer shares valued at Rs 233.30 billion

Chemspec Chemicals is a leading manufacturer of critical additives for FMCG ingredients used in skin and hair care products and intermediates for active pharmaceutical ingredients used in anti-hypertensive drugs.

The company manufactures products at its manufacturing facility in Taloja, Maharashtra.

The specialty chemicals manufacturer’s global sales network spanned 43 countries in North America, Europe, the APAC region (including Japan), the Middle East and Africa in the past three fiscal years.

JM Financial and Axis Capital are the lead managers for the public offering.

According to the draft papers, Northern Arc’s initial public offering includes a new issue of shares valued at Rs 300 billion and an offer to sell up to 36,520,585 shares by shareholders.

Those offering shares for sale include Leapfrog Financial Inclusion India (II) Ltd, Accion Africa-Asia Investment Company, Augusta Investments II Pte Ltd, Eight Roads Investments Mauritius II Ltd, Dvara Trust and IIFL Special Opportunities Fund.

The company may consider issuing shares in a private placement for up to Rs.150 billion in cash prior to filing the Red Hering prospectus with the Registrar of Companies (RoC).

The proceeds from the new issue are to be used to increase the company’s capital base to meet future capital requirements.

Registered with RBI, the company is a Non-Deposit-Take-Non-Banking-Finance (NBFC) company and has been in the financial inclusion field for over a decade.

Northern Arc is a leading player among the country’s diversified NBFCs with a business model diversified across offerings, sectors, products, regions and borrower segments. It provides underserved households and businesses with direct and indirect access to credit through originator partners.

Axis Capital, Credit Suisse Securities (India) Private Limited, IIFL Securities and SBI Capital Markets are the lead managers of the issue.

The equity shares of both companies are listed on the BSE and NSE.

(Only the headline and image of this report may have been revised by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)

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