New Delhi: Delhi-based real estate developer and promoter of the 1.8 lakh sq. ft jewellery mall in nearby Gurgaon, Aerens Gold Souk International Ltd, plans to come out with an initial public offer (IPO) of $400 million (about Rs1,644 crore) at an international stock exchange by December.
The company is in talks with several international stock exchanges, said Ashish Gupta, joint managing director of Aerens Gold Souk.
The company is looking at London’s Alternative Investment Market (AIM), the Singapore Stock Exchange and even the Dubai stock exchange.
Fending expansion: Aerens Gold Souk, which opened its first mall dedicated to jewellery retail in Gurgaon in 2004, plans to use the proceeds from the issue to open 100 more malls, six of them overseas.
“We are looking at different markets. Our merchant bankers are exploring all options,” Gupta added.
In the last two years, several Indian companies have tapped AIM for funds. Firms are attracted to this market, mostly because AIM does not require them to have a minimum market capitalization for listing.
Last year, the trend was driven by large real estate-related listings, such as the $700 million IPO of Unitech Corporate Parks Plc., an investment firm floated by real estate developer Unitech Ltd. Real estate firms such as Unitech are now also looking at tapping the Singapore Stock Exchange for funds.
Aerens plans to float a new holding company offshore and list it on an international stock exchange. The new company will hold equity stake in eight retail projects that Aerens plans to develop. The projects will be a combination of jewellery malls and large format multi-speciality malls.
Aerens plans to sell its equity stake in these projects to the holding company.
The holding company will then offload a portion of its equity in the projects during the share sale. “We don’t know how much stake we will retain. Our target is to raise $400 million” Gupta said.
Before the public issue, Aerens plans to make a pre-IPO placement of $80-100 million (about Rs328-411 crore) to a private equity company. The company is in advanced stages of talks with four private equity companies. “We expect to close a deal in around two months,” Gupta said.
The IPO proceeds will be used to fund the company’s expansion plans. Aerens plans to expand its network of jewellery malls by opening 100 malls in India and overseas by 2015. The expansion would be carried out in a phased manner. The company plans to open 94 malls in the country. The other six would be opened in the US, the UK, Canada, Thailand, the UAE, China and Sri Lanka.
Aerens opened its first mall dedicated to jewellery retailing in Gurgaon in 2004.
Aerens is also in talks with three state governments to set up gem and jewellery parks. The parks will house wholesale and retail jewellery stores.
“We are in the process of signing a lease agreement with the state government,” Gupta said. He declined to name the states because of confidentiality agreements.