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Balaji Wafers now plans IPO; has dropped stake sale option

Balaji Wafers now plans IPO; has dropped stake sale option
June 15, 2014
Indian snacks maker Balaji Wafers Private Limited is now preparing to come out with an initial public offering (IPO) to raise fund for its future expansions. The company that was in talks with private equity (PE) funds to sell stake, has dropped the idea of stake sale for now.

“We are now preparing to come up with an initial public offering (IPO) to raise funds for our future expansion. The company plans to offer not more than 10 per cent equity shares of the company,” confirmed Keyur Virani, director of Balaji Wafers adding that “As Indian economic and political scenario is changing and country’s economy will surely grow in next five years under the new government, and hence we have decided to take benefit of this and plan for IPO.”

Last July Balaji Wafers had decided to sell 15 per cent stake to PE funds and had started an exercise for it. Around December the company was in talks with investment firm Capital International Privet Equity Funds (CIPEF), however, the deal did not go through as Balaji felt that CIPEF’s offer was below Balaji’s market valuation. According Virani, the present market value of Balaji Wafers is about Rs 4,000 crore and the company will raise around Rs 400 crore from the equity markets.

Balaji Wafers plans to enter the north and south Indian market and also set up manufacturing units there. To fund this expansion project, the company had earlier decided to offload 15 per cent stake.
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Balaji Wafers is one of the larger potato chips producing companies in India, with a high market share especially in Gujarat.
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