Dixon Tech Plans 700-crore Pub­lic Is­sue in Sept


The Economic Times - - Companies - Gul­veen.Au­lakh@ times­group.com

New Delhi: Con­tract manufacturer Dixon Tech­nolo­gies plans to hit the cap­i­tal mar­kets in the first week of Septem­ber for rais­ing nearly .₹ 700 crore through a pub­lic of­fer, which will make the Noida-based com­pany the first In­dian mo­bile phone pro­ducer to be listed since the launch of the ‘Make in In­dia’ pro­gramme. The com­pany, which makes con­sumer elec­tron­ics, home ap­pli­ances, wash­ing ma­chines, mo­bile phones and light­ing prod­ucts for a num­ber of brands in­clud­ing Pana­sonic, Phillips, In­tex and Gionee, will chan­nel the funds to­wards set­ting up a new plant for LED tele­vi­sions and LED bulbs at Tiru­pati, pay­ing off debt and get­ting into new busi­nesses.

“We will get into back­ward in­te­gra­tion for LED tele­vi­sions with a ca­pac­ity of 1 mil­lion a year, and LED light­ing with ca­pac­ity of 5 mil­lion a month, in­clud­ing tube­lights, at the Tiru­pati plant, which will be used for ex­ports,” said Su­nil Vachani, chair­man and manag­ing di­rec­tor of the com­pany. “With the new plant, we will be the third-largest manufacturer of LED bulbs glob­ally, with a ca­pac­ity of 10 mil­lion a month,” he added. Dixon will also en­ter into mak­ing se­cu­rity sys­tems, cam­eras, recorders and dig­i­tal video recorders. Tiru­pati will be the firm’s sev­enth plant after three fa­cil­i­ties each in Noida in Ut­tar Pradesh & Dehradun in Ut­tarak­hand.

The com­pany, which got an ap­proval from the Se­cu­ri­ties Ex­change Board of In­dia (Sebi) ear­lier this month, will raise fresh eq­uity of .₹ 60 crore through the of­fer. While its long time in­vestor, Moti­lal Oswal Pri­vate Eq­uity, will exit par­tially as it will sell 24% from its 30% stake, by sell­ing 2.6 mil­lion shares, the pro­mot­ers will sell 1.1 mil­lion shares, tak­ing the to­tal shares on of­fer to 3.7 mil­lion. Moti­lal Oswal had in­vested .₹ 40 crore in 2008.

Pro­ceeds from the sale will go to pay­ing off half its out­stand­ing debt of .₹ 45 crore, as per the draft prospec­tus filed last month. Post the of­fer, re­tail in­vestors will hold about 40% of the com­pany. IDFC Bank, IIFL Hold­ings, Moti­lal Oswal In­vest­ment Ad­vi­sors and Yes Se­cu­ri­ties are the book run­ning lead man­agers to the is­sue.

Co to use funds to set up a new plant for LED TV and LED bulbs, pay off debt and get into new busi­nesses

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