Pipe manufacturer Welspun Corp.'s promoter entity and a top executive collectively plan to sell company shares worth up to ₹1,418 crore ($149 million) through a block deal on Wednesday, just days after a record ₹17,200 crore US order, according to a transaction term sheet reviewed by Mint.
Welspun Investments and Commercials Ltd, a member of the company's promoter group, and managing director and chief executive Vipul Mathur are offering up to 6 million and 300,000 equity shares, respectively. The total volume represents approximately 2.4% of the company's existing total outstanding equity capital. Prior to the share sale, Welspun Investments held 6.75 million shares, representing a 2.56% stake, while Mathur likely held less than 1%. Both sellers are subject to a 90-day lock-up period on their residual shareholding following the trade date.
The offer floor price for the transaction is set at ₹2,250 per share, representing a 4.1% discount to the stock's closing price of ₹2,345.50 on the National Stock Exchange of India on Tuesday.
The stock jumped nearly 20% over two trading sessions before paring gains to close nearly 3% lower at close on Tuesday.
If the deal goes through, the Welspun block would be one of the two major secondary transactions to hit the market on Wednesday. Ribbit Capital is looking to sell up to ₹1,914 crore ($200 million) worth of shares in Groww parent Billionbrains Garage Ventures Ltd through another block deal, according to another term sheet that Mint has reviewed.
These transactions would be the latest in an increasingly busy secondary market in the country.
On Monday, Y Combinator-linked entities sold 4.85 crore Meesho shares worth ₹970 crore through block deals, after offloading Groww shares worth over ₹1,400 crore the previous week. On Friday, Trudy Holdings, AVP I Fund and Accel launched a ₹600 crore block deal in Amagi Media Labs Ltd, representing around 5% of the company's equity. On the same day, Qualcomm Ventures also cashed in nearly ₹200 crore by selling 7.5 million shares in a secondary market transaction.
In the week ended Friday, Paytm founder Vijay Shekhar Sharma's Resilient Asset Management B.V. also sold a 3% block worth over $300 million in One 97 Communications Ltd, with the economic value of the transaction going to Antfin. Elevation Capital, too, offloaded a partial stake in Paytm on 4 August, cashing in more than $200 million. Before Sharma and Elevation's stake sales, Fidelity-backed Eight Roads Ventures, Walmart-owned Flipkart Internet, and IMM India Fund offered to sell a combined stake of up to 9.08% in Shadowfax Technologies Ltd for around $100 million on 23 July.
Prior to that, eyewear retailer Lenskart Solutions Ltd had seen early backers offload their holdings once their lock-ins expired. Singapore's sovereign wealth fund Temasek sold a 2% stake in Lenskart for ₹1,940 crore this month, after Abu Dhabi's sovereign wealth fund sold a 2.3% stake for a similar amount. On 3 June, a SoftBank entity sold a 3.25% stake through a block deal worth ₹2,873 crore.