Wockhardt hospitals' initial public offering will open for subscription on February 1 instead of January 31. The issue which had been reduced in size did not open for subscription as scheduled on Thursday after the stock exchanges asked for a letter from the capital markets regulator before giving the green light.
The SEBI approval was pending given that the company had issued a statement late in the evening on January 30, revising the price band. Wockhardt is the first company to revise its issue size and price band post the recent plunge in equity markets.
"Bankers took the decision to change the price band of the IPO because of the current market dynamics. We are now waiting for SEBI's approval before proceeding with the IPO. Bankers should receive the letter soon," Wockhardt's chairman Habil Khorakiwala had told ET earlier in the day.
"We had informed Sebi about the change in price band and received a verbal confirmation before issuing the release on Wednesday, but the stock exchange wants a written letter from SEBI," Mr Khorakiwala added. SEBI issued the letter late in the evening on Thursday.
Merchant banking sources confirmed late evening that the issue would open for subscription on February 1 and would close on February 5. Mumbai-based Wockhardt, can now raise a maximum of up to $160 million, around 17% less than its target on January 22. The company had cut its offer price band to Rs 225-260 from Rs 280-310 before the opening of the offer on Thursday.
The health-care provider, owned by the founder of Indian drug maker Wockhardt, needs funds to double its hospital chain in two years. Joint global book coordinators and book running lead managers to the issue include Citigroup Global Markets India, Kotak Mahindra Capital, SBI Capital Markets Ltd. and ICICI Securities.
Waning investor interest and a global sell-off in equities because of the US subprime crisis has of late reduced or halted many issues that were in the pipeline. Emaar MGF, which is due to open for subscription on Friday, is yet another instance of a company revising its price band in line with the market dynamics. Tulsi Extrusions, another company whose offering is to open for subscription on Friday, however, is not expected to revise its price band.
India's benchmark BSE Sensex has declined 7.18%, while the MSCI Asia Pacific Index has fallen 3.8%, since Reliance Power's IPO closed on Jan. 18. The offer raised the maximum $3 billion sought after the IPO sold out in the first minute. Subsequent IPOs from infrastructure firm KNR Constructions, cable maker Cords Cable Industries Ltd and On Mobile Global were fully subscribed only on the closing day of their bids.
