Key Points of Samhi Hotels Refiles IPO Papers:
- Samhi Hotels, an Indian hotel ownership and asset management platform, is aiming to go public through an initial public offering (IPO) to unlock value.
- The company had initially filed for an IPO in 2019 but canceled its plans due to market conditions and the Covid-19 pandemic.
- Samhi Hotels is now seeking to take advantage of the surge in domestic consumption and underlying GDP growth in India’s hospitality industry.
- The company is looking to raise Rs 1,000 crore via the fresh issue route, and the IPO will also include an offer-for-sale (OFS) component.
- The net proceeds from the IPO will be used for repayment of borrowings, payment of interest, and general corporate purposes.
- Samhi Hotels has the third-largest inventory of operational keys in India, owning and leasing 3,839 keys across 25 operating hotels in 12 urban centers.
- The company typically operates under long-term management contracts with established global hotel operators such as Marriott, Hyatt, and IHG and has the largest portfolio of Fairfield by Marriott and Holiday Inn Express in India.
Details of Samhi Hotels IPO:
Samhi Hotels, a well-known branded hotel ownership and asset management platform in India that operates major global hotel chains such as Marriott, Hyatt, and IHG, is aiming to unlock value through an initial public offering (IPO).
The firm, which was established by Ashish Jakhanwala and Manav Thadani in 2010 and backed by Goldman Sachs, Equity International, GTI Capital, and IFC, initially filed for an IPO in September 2019 but canceled its plans due to market conditions and the impact of the Covid-19 pandemic.
Samhi Hotels is now looking to take advantage of the surge in domestic consumption and underlying GDP growth that has resulted in strong capacity utilization in the Indian hospitality industry in recent quarters of the Financial Year 2023. According to the re-filed draft red herring prospectus (DRHP), the company is aiming to raise Rs 1,000 crore via the fresh issue route, and the IPO will also include an OFS component of up to 9,00,00,000 equity shares, with all the key investors seeking to dilute their stake.
The net proceeds from the IPO will be used for repayment of borrowings of the firm and its subsidiaries, payment of interest, and general corporate purposes. According to the DRHP, Samhi Hotels has the third-largest inventory of operational keys (owned and leased) in India as of February 28, 2023, as reported by JLL.
As of February 28, 2023, the company has built a portfolio of 3,839 keys across 25 operating hotels in 12 of India’s key urban consumption centers, including Bengaluru, Hyderabad, National Capital Region, Pune, Chennai, and Ahmedabad. All of its hotels are in the Upper Upscale and Upscale, Upper Mid-scale and Mid-scale hotel segments, and they typically operate under long-term management contracts with established and well-recognized global hotel operators such as Marriott, Hyatt, and IHG.
The DRHP states that Samhi Hotels has adopted an acquisition-led strategy, which is supported by its track record of acquiring and successfully turning around hotels to grow its business. The company’s dominant position among the Upper Mid-scale and Mid-scale brands in India has enabled it to expand its Fairfield by Marriott and Holiday Inn Express portfolio to 936 and 1,427 keys, respectively, as of February 28, 2023, making it the largest owner of these brands in India.
The investment bankers working on the deal are JM Financial and Kotak Mahindra Capital, while Shardul Amarchand Mangaldas and Indus Law advised Samhi Hotels and the banks, respectively. J Sagar Associates, Khaitan and Co, Cyril Amarchand Mangaldas, and AZB & Partners are the legal advisors for the investors.
According to recent media reports, Appeejay Surrendra Park Hotels may also re-file papers with Sebi and float an IPO later this year.
About Samhi Hotels:
Samhi Hotels has a consolidated portfolio of approximately 3,900 rooms spread across 25 properties, which include popular international brands such as Sheraton, Courtyard Marriott, Hyatt Place, Hyatt Regency, Four Points Sheraton, Fairfield Marriott, and Formule1. Out of these, 16 hotels are currently operational, and the remaining properties are in different stages of development.
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