Spice Communications IPO opens on 25 June 2007

Price band Rs 41 - 46 per share

Spice Communications intends to garner around Rs 520 crore through its initial public offering, which opens on 25 June 2007.

The issue, having a price band between Rs 41 - 46 a share, will close on 27 June 2007. The company is taking a 100% book-building route for the IPO.

The company will issue 11.31 crore equity shares of Rs 10 each and the issue will comprise 16.39% Spice Communications’ fully diluted post-issue share capital.

The company had earlier raised Rs 112 crore through a pre-IPO placement of 2.48 crore shares at Rs 45 each.

Malaysia’s official service provider Telekom Malaysia (TM) holds 49%, while industrialist and Modi group Chairman B K Modi owns the remaining 51% stake in Spice Communications.

Spice Communications will use around 50% of the total proceeds to retire part of its Rs 1,000 crore debt, while the remaining would be used for expansion plans.

The company’s expansion plans included foraying into national long distance (NLD) and international long distance (ILD) services in the country.

Post IPO, TM’s stake in the company will fall to 39% and the promoter’s holding to 41%, while retail public holding will increase to around 20%.

Spice Communications' net loss of Rs 68.58 crore in the full year ended June 2006 from Rs 6.97 crore in FY 2005. Sales advanced 9.1% to Rs 661.49 crore in FY 2006 (Rs 606.57 crore).

The company's shares would be listed on the BSE. Spice Communications could not list its shares on the National Stock Exchange (NSE), where listing of companies with negative networth is not permitted.