softbank firstcry stake sale: SoftBank fund sells more of its FirstCry stake ahead of IPO

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SoftBank Vision Fund, the largest shareholder in IPO-bound omnichannel retailer FirstCry, has sold additional shares in the company, paving the way for more family offices and individuals to pick up a stake in the firm.

Family offices of Indian cricketer Sachin Tendulkar, Ravi Modi of ethnic wear brand Manyavar, Infosys cofounder Kris Gopalakrishnan, and TVS group family are among those buying into the company, people aware of the matter said.

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This takes the total secondary share sale ahead of next year’s planned public listing to more than Rs 1,000 crore in FirstCry.

Of the total, SoftBank has sold shares for as much as about Rs 600 crore cutting its holding to below 25% in the company, people briefed on the matter said. The Masayoshi Son-led technology investor has been diluting its holding from around 29-30% a couple of years ago. ET first reported on December 19 that FirstCry is expected to file its draft IPO papers this week. The company is aiming to raise $500-600 million through its public offering.

Three family offices, Ranjan Pai (Manipal Group), Harsh Mariwala’s (Marico) investment office Sharrp Ventures and Hemendra Kothari’s DSP family office had picked up shares in FirstCry, ET reported on August 21.

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For SoftBank, it has invested around $400 million in the firm and has taken home close to $300 million already, sources aware of the matter said. It had first invested in FirstCry in 2020. “The remaining stake could still be valued at $1 billion if it lists at a valuation of $ 4 billion or more,” a person aware of the matter said.

FirstCry hasn’t announced its valuation during the IPO but sources said it could be in the range of $4 billion. It was last valued at just under $3 billion.

FirstCry and SoftBank declined to comment.

In a secondary share sale, existing investors sell their stake in parts or full to new investors and the capital doesn’t go to the company coffers. While in a primary share sale, new shares are issued and the company raises money through the same. FirstCry’s $500 million IPO is expected to have 35-37% of the offer in primary share sale while the rest would be in secondary–also known as offer for sale (OFS)

The new investors are joining FirstCry’s cap table which includes Premji Invest–the family office of Wipro founder Azim Premji, the Mahindra group and others.

FirstCry financialsETtech

FirstCry will be the second Indian vertical ecommerce platform to go public after Nykaa’s IPO in 2021. The Pune-headquartered company specialises in selling products for children and mothers across online and offline formats. It is close to crossing 1,000 retail stores in India. FirstCry also has a ecommerce roll up subsidiary Globalbees.

Supam Maheshwari, Sanket Hattimattur, Amitava Saha and Prashant Jadhav founded FirstCry in 2010. Maheshwari and Hattimattur are on the company board while Saha runs Xpressbees – a logistics firm that was spun out from the ecommerce firm. Nitin Agarwal is the chief executive of Globalbees.

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