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MTAR IPO: Ex-Blackstone MD who made 1,400% on MTAR IPO says no plan to sell remaining shares

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NEW DELHI: The MTAR IPO, which received a solid 200 times subscription in its just concluded IPO, is set to deliver a whopping 1,400 per cent, or 15 times, gains to former Blackstone Senior MD, Mathew Cyriac, who through his entities Fabmohur Advisors and Solidus Advisors had bought one-third of the company in 2017.

If one were to go by prevailing premium that the grey market is offering on the unlisted shares today, Cyriac’s remaining post-IPO shares in the company would be enjoying a 2,744 per cent return on listing!

Fabmohur Advisors LLP along with Solidus Advisors held 88,60,570 shares prior to the IPO, which were 33.11 per cent of the total MTAR shares. The shares were bought at an average cost of Rs 38.44 per share, as per the red herring prospectus. The IPO had an OFS of 5,874,300 shares by Fabmohur Advisors. These shares were sold in the price band of Rs 574-575, suggesting 15 times gains, or 1,396 per cent return.

Mathew Cyraic has been playing an active part of the MTAR board with involvement in the audit committee, nomination and remuneration committee as well as the management committee which took decisions with respect to operations and day to day management.

In an telephonic interview with ETMarkets.com, Cyriac said he never thought he would realise 15-times returns within such a short time, but said he had faith in the 50-year-old family run company, although it was loss making when he acquired it.

“MTAR is very unique in what it offers. The 50 year old company has built certain differentiated technical capabilities which is not available with many companies in India or globally. It was an undermanaged business and I knew that could be fixed. MTAR is a family owned business but has swiftly professionalised the management in the last few years,” Cyriac said.

“We made a lot of changes to streamline operations, improve productivity and reduce cost. We also focused on driving the export mix of the business. We also introduced performance management process through monthly MIS and continuous reviews,” Cyriac said, adding that his emphasis was on the performance management.

Fabmohur would receive over Rs 335 crore in the IPO at the upper end of the price band. Fabmohur and Solidus will collectively continue to own over 10 per cent of the company post the IPO with an ownership of 30,76,270 shares, which are valued at over Rs 177 crore.

Cyriac said he has no plans to dilute his stake in the company for a considerable period.

Founder at Gujarat-based at UnlistedArena.com, Abhay Doshi, who also tracks grey market, said the stock was commanding Rs 430 premium in the grey market, which has now surged to Rs 530-odd level, following the strong investor response to the issue.

Cyriac said while every other IPO these days is getting a strong listing response, one must note the quality of pre-ipo investors (SBI MF and Axis MF) and the anchor investors the company attracted last week, 10 of top 10 domestic mutual fund houses.

Cyriac, who now is the Executive Chairman of Florintree Advisors, a Mumbai-based India-focused Alternative Asset Manager, was a senior managing director at The Blackstone Group and served as its Co-Head of Private Equity at Blackstone Advisors India till February 2017.

Cyriac’s other investments include garment exporter Gokaldas Exports, CMS IT Services, insurance broker OneInsure, subway sandwich chain Bread Basket and fintech startup City Cash, according to a recent ToI report. The MTAR stake is the first investment in a company that he will be encashing, albeit partially.

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