New Delhi, India – Lemon Tree Hotels receives approval from The Securities and Exchange Board of India (SEBI) to sell shares of its company in an initial public offering (IPO). The hotel chain is the 46th firm to receive clearance for IPO this year according to SEBI’s official website.
The application was submitted in September, which comprises the sale of 195.79 million shares by the company’s promoters and Warburg Pincus, an equity giant that acquired around 25% of Lemon Tree in 2006. The issue is seen to produce an outcome of a stake reduction on a post-issue basis.
Warburg Pincus will sell half of its 192.9 million shares, which will result in a drop from 24.53% to approximately 12.51%.
The public offering aims to attain the advantages of listing the equity shares on the stock market. The shares are proposed to be listed on the BSE and the National Stock Exchange (NSE), while the sales will be managed by Kotak Mahindra Capital Company, CLSA India, JP Morgan India, and YES Securities.
“Our company expects that listing of the equity shares will enhance our visibility and brand image and provide liquidity to our shareholders. Listing will also provide a public market for the equity shares in India,” the company said in the DRHP.
About Lemon Tree Hotels
Lemon Tree Hotels is India’s largest hotel chain in the mid-priced hotel sector. The award-winning hotel chain was founded in 2002 by Patu Keswani and manages four brands: Lemon Tree Premier, Lemon Tree Resorts, Lemon Tree Hotels, and Red Fox Hotels. It operates 40 hotels in 24 cities with 4,289 rooms and has over 4,000 employees.