Brigade Hotel mobilises ₹325 crore from anchor investors ahead of IPO

The initial public offering (IPO) will open on Thursday and close on July 28, with a price band of ₹85 to ₹90 per share

Brigade Hotel Ventures Ltd, owner and developer of hotels in south India, on Wednesday raised Rs 325 crore from anchor investors, a day before its initial share-sale opening for public subscription.

The anchor book saw participation from investors, including SBI Mutual Fund (MF), 360 One MF, Axis MF, Motilal Oswal MF, Bandhan MF, Edelweiss MF and Nuvama MF, according to a circular uploaded on the BSE's website.

As per the circular, Brigade Hotel Ventures has allotted over 3.6 crore equity shares to 17 funds at Rs 90 apiece. This aggregates the capital raising to Rs 324.72 crore.

The initial public offering (IPO) is scheduled to open on Thursday and conclude on July 28. The price band has been set at Rs 85 to Rs 90 per share.

At the upper end of the price band, the company is valued at over Rs 3,400 crore.

Brigade Hotel Ventures' IPO is entirely a fresh issue of equity shares worth Rs 759.6 crore with no offer-for sale (OFS) component.

Proceeds from the issue to the tune of Rs 468.14 crore will be used for the payment of debt; Rs 107.52 crore will be utilised for the purchase of an undivided share of land from the promoter, BEL; and the remaining funds will support acquisitions, other strategic initiatives, and general corporate purposes.

Earlier this month, Brigade Hotel Ventures raised Rs 126 crore by selling equity shares to 360 ONE Alternates Asset Management.

Brigade Hotel Ventures Ltd is a subsidiary of Bengaluru-based real estate company Brigade Enterprises Ltd (BEL).

BEL entered into the hospitality business in 2004 with the development of its first hotel, Grand Mercure Bangalore, which commenced operations in 2009.

The company has a portfolio of nine operating hotels across Bengaluru (Karnataka), Chennai (Tamil Nadu), Kochi (Kerala), Mysuru (Karnataka) and the GIFT City (Gujarat) with 1,604 keys.

The hotels are operated by global marquee hospitality companies such as Marriott, Accor and InterContinental Hotels Group.

The company announced that 75 per cent of the offer size has been set aside for qualified institutional buyers, 15 per cent for non-institutional investors and the remaining 10 per cent for retail investors.

JM Financial and ICICI Securities are the book-running lead managers to the issue. Shares of the company are expected to list on the bourses on July 31.