Aeroflex Industries gets Sebi green light to float Rs 350-crore IPO

The Securities and Exchange Board of India (Sebi) has given the green light for Aeroflex Industries, a manufacturer of metallic flexible flow solution products, to issue its initial public offering.

The IPO will consist of a fresh issuance of equity shares valued at Rs 160 crore and an offer-for-sale of 1.75 crore equity shares by founders SAT Industries and Italica Global FZC, and is expected to raise Rs 350 crore for the firm.

According to the public processing status report, the company submitted its draught IPO documents to Sebi on March 31st, and the regulator issued its observation letter for the IPO on July 31st.

According to the Sebi, the company can proceed with the proposed initial share offering after the observation was issued over the draught offer document.

The listed subsidiary of the diversified business group SAT Industries plans to utilise the proceeds from the new issue to pay down debt, fund working capital needs, and make further corporate investments and inorganic purchases.

More than 80 countries receive goods from this corporation, which carries 1,700 SKUs (stock keeping units). For the 10 months leading up to January 2023, 80.85% of its revenue came from exports.  

Flexible flow solutions play a critical role in transfer of substances (air, liquid and solid) in any industrial or commercial ecosystem, connecting the origin and end-points of various processes. For instance, flow solution products are required in fire sprinklers, gas supply, flow of air in aircraft, fueling and hydraulics in aircraft.

Promoters SAT Industries held 92.18 percent stake in Aeroflex and 6.52 percent shares were with other promoter Italica Global FZC at the time of filing the draft papers. The remaining 1 percent was held by public.

In May and June this year, SAT Industries entered secondary transactions with investors such as Ashish Kacholia, Carnelian Structural Shift Fund, VPK Global Ventures Fund and Samedh Trinity Partners. The company has transferred 86.95 lakh equity shares to these investors at a price of Rs 87.56 per share, and raised Rs 76.13 crore.

Pantomath Capital Advisors is the merchant banker for the issue.

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