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SEEKING A STRATEGIC PARTNER - Ocean Sparkle Looks to Sell up to 74% Stake

( 11:00, 01-Apr-16)

SEEKING A STRATEGIC PARTNER - Ocean Sparkle Looks to Sell up to 74% Stake

Promoters, investors in the process of appointing i-banker to scout for buyers

Promoters and investors in port operations and management services provider Ocean Sparkle are looking to sell up to 74% stake to a strategic investor and are in the process of appointing investment bankers for the purpose. A clutch of investors led by Standard Chartered Private Equity and IFC hold around 53% stake in the Hyderabad-based company that is being valued at $300 million, said three people directly involved in the process.

“The promoters and investors have decided to bring in a strategic partner who will own a majority stake in the company, “ an investment banker with knowledge of the company's plans said. “The company has invited pitches from investment banks in March and will appoint a bank soon.“

Founded in 1995 by marine technocrats, Ocean Sparkle today has operations in the Middle East, Singapore and Sri Lanka apart from India. The company serves all the major ports in India with its fleet of 69 harbour tugs, eight pilot boats, five mooring boats, six dredgers and five barges.

The company has seen private equity and venture capital interest for more than a decade, and has been backed by Andhra Pradesh Industrial Corporation Venture Capital and a Swiss Technology Fund in its early days after which various others, including IFC and Standard Chartered, stepped in.

As per the December 2015 ra tings release by ICRA, Ocean Sparkle's core promoters are P Jairaj Kumar, Sanjeev Dhawan, AK Sawhney and R Virender Prasad, who together hold 35% stake in the company .“Another 2% is held by friends and relatives of the promoters, while 10% is with NRIs,“ the ratings release said.

According to the ICRA report, 53% in the company is held by Park Equity, Infrastructure India Holdings Fund, Standard Chartered Private Equity and IFC Washington.

The company has grown considerably with the help of PE and VC funds and now the management wants a strategic investor with deep pockets to come in,“ another investment banker said.

They will sell up to 74% stake in the company to the incoming investor. The promoters too will dilute some stake.“

Thank you for the interest in Ocean Sparkle.As the matter is confidential to the company and its investors, we regre our inability to comment on the same,“ P Jairaj Kumar chairman of the company, sa id in an emailed response to an ET query.

Spokesperson for Standard Chartered declined to com ment. Other spokespersons for IFC, IEP and Kaup did no respond to emailed queries till press time. Ocean Sparkle along with its subsidiaries has a total operating income `445 crore and a profit after of61 crore for the financial tax of .al year ended March 31, 2015 against a total income of .389 ` crore and a profit after tax of .40 crore in FY14, the ICRA ra tings release shows.

Source Economic TImes


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