Kayum Razak Dhanani, the Managing Director of Barbeque Nation Hospitality Limited, in an exclusive talk with Zee Business’s Mehek Kasbekar, said a part of the proceeds raised by the initial public offering (IPO) will be utilised in repayment of loans, while rest will be deployed in setting up new Barbeque Nation restaurants in India and general corporate purposes. Here are the edited excerpts from the interview:
Q: Barbeque Nation is coming up with an IPO that comprises fresh issue of shares worth Rs 200 crore. Can you please let us know about the areas in which the proceeds of the issue will be utilised?
A: The initial primary offering is of Rs 160 crore. Out of which nearly Rs 80-85 crore of the proceeds will be used in repayment of debt, expansion and general corporate purposes.
Q: You said about the plans of repayment of loans. Your Draft Red Herring Prospectus (DRHP) says that the company is supposed to repay Rs 85 crore. Can you please tell something about the debt situation in books and what is the status of cash?
A. As of 2017, in our books, we have a net debt of Rs 40 crore. It also includes the cash.
Q: The DRHP mentions certain hiccups with SEBI under which show cause notice was issued related to 25% public floating norms. Do you want to say something to the investors?
A: It was not a hiccup. It was just a process issue and has been sorted out. The penalties have been paid. In fact, the issue was related to the parent company of Johnny Rockets Hotels, the company which was acquired by Barbeque Nation.
About Barbeque Nation Restaurants
Barbeque Nation Restaurants is owned by Barbeque Nation Hospitality and it has grown its restaurant network from a single restaurant in 2006-07 to 81 till June 30, 2017. In recent past, it also added three international chains on the list.