New Delhi :

Coffee Day Enterprises, which runs the country’s biggest coffee chain Cafe Coffee Day, has received markets regulator SEBI’s go—ahead to raise Rs. 1,150 crore through initial public offering (IPO).

The firm had filed its draft red herring prospectus (DRHP) with SEBI through its lead merchant banker Kotak Mahindra Capital Company Limited on June 26 this year.

Securities and Exchange Board of India (SEBI) issued its final observations on the draft offer documents on August 14, which is necessary for companies to launch any public offer.

As per the draft paper, the company intends to raise an estimated Rs. 1,150 crore to aid its expansion plans and pay off debt.

The company, which has got private equity giants like KKR, Stanchart PE and New Silk Route as its investors, has reserved Rs. 15—crore worth shares for staff.

The company proposes to list its shares on the BSE and the NSE.

Coffee Day Enterprises is the parent company of the Coffee Day Group and operates coffee business through a subsidiary, Coffee Day Global Limited (earlier known as Amalgamated Bean Coffee Trading Company Limited), and its subsidiaries.

Coffee Day Global Limited had a total income of Rs. 1,154 crore and operating profit of Rs. 189 crore in 2013—14 fiscal.

Out of the capital raised through the issue, the parent company plans to utilise nearly Rs. 632 crore to pay off debt and the remaining to open new stores, set up coffee bean roasting plants and make vending machines, the proposal said.

In the next two financial years, the company plans to open over 215 outlets and set up 105 kiosks.

source: http://www.thehindubusinessline.com / Business Line / Home> Markets / PTI / August 17th, 2015