Veranda to raise Rs 200 crore via IPO, price band fixed at Rs 130-137

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Veranda Learning Solutions has fixed the price band of its initial public offering (IPO) at Rs 130 to Rs 137 per equity share of face value of Rs 10. The Chennai-based company plans to raise Rs 200 crore through the IPO which will open on March 29 and close on March 31. The anchor investor bidding will be on March 28.

The company intends to repay debts to the tune of Rs 60 crore from the net proceeds of the offer. The funds will also be utilised for the payment of acquisition consideration of Edureka and repayment of a Rs 25.2 crore bridge loan availed specifically for the purpose of acquisition consideration of Edureka and growth initiatives to the tune of Rs 50 crore.

Kalpathi S Suresh, ED-cum-chairman, Veranda Learning Solutions said:”As part of its expansion plans, the company would be offering competitive exam courses in more vernacular languages and to take the software training vertical (Edureka) to more geographies. Right now, competitive exam courses are available in English, Hindi, Tamil, Telugu, Kannada and Malayalam.”

In the IPO, the company has reserved up to 75% of the total offer for qualified institutional buyers, 15% for non-institutional bidders, and the remaining 10% for retail investors.

He said: “This is the year of investments. All these investments were done with an eye on the future. And you will see the benefits of it from the next fiscal. From there, in the next 3-5 years, you will see us as an aggressively growing company with a clear eye on profitability.”

Prior to filing the red herring prospectus, the company had raised Rs 40 crore by issuing 30.76 lakh equity through a private placement to the public category.Suresh said that Veranda had made investments in expanding its content portfolio across multiple vernaculars, expanded its footprint across 25 locations in Tamil Nadu and Karnataka, invested in building or tweaking its technology platforms to go offline hybrid in software vertical.

Veranda offers diversified and integrated learning solutions in online, offline hybrid and offline blended formats to students, professionals and corporate employees, through four subsidiaries Veranda Race Learning Solutions, Veranda XL Learning Solutions, Veranda IAS Learning Solutions, and Brain4ce Education Solutions (Edureka).

Systematix Corporate Services is the book running lead manager to the issue.