The shares are being offered at a floor price of ₹195 apiece, according to the terms of the deal. The floor price is the minimum price at which Ribbit Capital is offering the shares to investors.
The transaction will allow Ribbit Capital to partially monetise its investment in Groww while continuing to retain its remaining stake in the company.
Ribbit Capital faces 30-day lock-up after sale
As part of the terms of the transaction, Ribbit Capital will be subject to a 30-day lock-up period following the block deal.
This means the investor will not be permitted to sell additional shares in Billionbrains Garage Ventures during that period.
Such lock-up provisions are typically included in large block transactions to provide buyers some assurance that the seller will not immediately return to the market with another large tranche of shares.
The ₹1,914 crore offer is based on the sale of 1.6% of Billionbrains Garage Ventures’ total equity at the ₹195-per-share floor price.
At those terms, the transaction implies a valuation of roughly ₹1.2 lakh crore for the Groww parent. The figure is an implied valuation based on the block-deal terms rather than a separate valuation announced by the company.
Another large secondary stake sale
The transaction is a secondary share sale, meaning the money from the block deal will go to Ribbit Capital rather than Billionbrains Garage Ventures. The company itself is not raising fresh capital through the transaction.
Ribbit Capital has been an investor in Groww, which operates an online investment platform offering products including stocks and mutual funds.
The block deal will reduce Ribbit Capital’s holding in the company by 1.6 percentage points once completed, while the 30-day lock-up will restrict any further sale by the investor immediately after the transaction.
