NSR exits VRL Logistics through Rs147 crore block trade

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Mumbai: Private equity firm New Silk Route (NSR) on Friday sold its remaining 5.16% stake in logistics firm VRL Logistics Ltd through a block trade on the stock exchanges for around Rs.147 crore, said two people aware of the development.

The share sale resulted in a complete exit for NSR, which had invested Rs.175 crore in the company in 2012.

NSR had earlier part exited the firm through an initial public offering (IPO) in April 2015. Through the IPO, NSR had sold around 14.5 million shares at a price of Rs.205 per share, thus fetching around Rs.298 crore. The public offer was oversubscribed 74 times.

The trade on Friday saw NSR sell around 4.7 million shares at a price of around Rs.312.5 apiece, said one the persons mentioned above, requesting anonymity as he is not authorized to speak to the media.

Shares were bought by large institutional investors such as domestic mutual funds and insurance firms as well as foreign institutional investors, he added. ICICI Securities Ltd advised NSR on the block trade, the second person cited above said, also requesting anonymity.

“The trade was executed by NSR. Promoters or promoter entities have not sold shares,” said Sunil Nalavadi, chief financial officer of VRL Logistics. An NSR spokesperson could not be immediately reached for comment.

VRL Logistics is not the only company that NSR has exited from in recent times.

Last year, other NSR companies Ortel Communications Ltd and Coffee Day Enterprises Ltd went public. NSR part exited its stake in Ortel through the IPO.

In an interaction with Mint in December 2015, Parag Saxena, founding general partner and chief executive officer at NSR, said that the private equity firm is looking to return at least $500 million to its investors in 2016 before it looks to raise a second fund.

“We have returned $200 million to our investors this year. We are knocking on the door of 2016 and clearly we would like to liquefy these investments and realize them and that is certainly the biggest activity at NSR right now,” said Saxena.

Apart from the IPO exits, the fund has also sold its investment in Destimoney Enterprises Pvt. Ltd to the Carlyle Group for an undisclosed amount. NSR was founded in 2006 and has $1.4 billion under management, mainly in India and emerging economies in Asia. It has 17 publicly disclosed investments on its website. It did not make any investments in 2014.

Its last investment was in September 2013, when it acquired Mumbai-based chain of restaurants Moshe’s Fine Foods Pvt. Ltd through its portfolio company South Asia Gastronomy Enterprises Llc.

In May, Mint reported that NSR is planning to sell Moshe’s, to a strategic buyer. The fund has been in talks with several buyers in the last six months, and is looking at valuation of around Rs.75-100 crore for the company.

The fund has investments in consumer services, education, manufacturing and engineering, financial services, telecommunications and technology, and infrastructure.

PE funds registered 84 exit deals in the first half of the calendar year, worth almost $3.79 billion, data from Venture Intelligence shows. However, exit activity fell far short of the $5.91 billion worth of exits recorded, across 139 deals, in the same period last year.

Overall, 2015 witnessed 254 exit deals translating into $9.3 billion of capital that PE funds returned to their investors. Shares of VRL Logistics closed the day at Rs.310.9 per share on BSE, down by 5.75%, while the benchmark Sensex fell 0.38% to 27,836.5 points.