Indian property trust’s $263m from IPO less than hoped for

Indian property trust’s $263m from IPO less than hoped for

 

INDIABULLS Properties Investment Trust has raised a total of $262.5 million from an initial public offer (IPO), below the maximum $288.8 million it sought.

 

The Indian real estate trust yesterday said it sold 262.5 million shares at $1 apiece, at the bottom of an indicated band of between $1 and $1.10.

 

The lower pricing came even after an extension of the retail tranche offer.

 

On Thursday, the company pushed back the deadline for the IPO from noon that day to yesterday at 5pm. The offer was launched on Monday night.

 

The company has not explained the deadline extension, but reports on Thursday quoting a banker involved in the deal said the delay was because the retail component of 13 million units had not been fully taken up.

 

The banker added that the IPO attracted only 700 out of a required 1,000 subscribers.

 

The IPO’s lack of popularity stands in contrast to OCBC Bank’s recent preference share offer.

 

The placement tranche of the lender’s billion-dollar, fund-raising exercise, launched also on Monday, proved hugely popular among investors.

 

Overwhelming demand, with the placement tranche three times oversubscribed, led the bank to close the offer early – on Wednesday.

 

Indiabulls has also issued 91 million units to Indian billionaire Lakshmi Mittal, the world’s fourth-richest man, on top of the units sold at the IPO.

 

The trust will use the funds to develop, acquire and invest in office space, initially in central Mumbai.

 

Office rents in Mumbai have doubled over the past two years, and only 3 per cent of the city’s offices are vacant.

 

Source : Straits Times

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