Mumbai, Aug 24: Hero Motors Ltd, the auto-components firm of the Hero Motors Company (HMC) Group, on Saturday filed preliminary papers with Sebi to raise Rs 900 crore through an initial public offering (IPO).
According to the draft red herring prospectus (DRHP), the IPO is a combination of a fresh issue of equity shares worth Rs 500 crore and an Offer-For-Sale (OFS) of shares valued at Rs 400 crore by promoters.
The OFS includes Rs 250 crore worth of shares by O P Munjal Holdings, and Rs 75 crore each by Bhagyoday Investments and Hero Cycles.
O P Munjal Holdings owns 71.55 percent stake in Hero Motors. Bhagyoday Investments, and Hero Cycles hold 6.28 percent and 2.03 percent shares, respectively. South Asia Growth Invest LLC has 12.27 percent shareholding in the company.
However, the company may consider a pre-IPO placement of Rs 100 crore.
According to the DRHP, proceeds from the fresh issue to the tune of Rs 202 crore will be used for debt payment, Rs 124 crore for purchase of equipment required for expansion of the company's facility in Gautam Buddha Nagar, Uttar Pradesh.
