New Delhi, Nov. 19 -- Tenneco Clean Air India Ltd, an auto components supplier controlled by US-based private equity firm Apollo Global Management, made a strong trading debut on Wednesday after a Rs 3,600-crore ($406 million) initial public offering that drew an overwhelming response from investors.
Shares of Tenneco Clean Air began trading on the BSE at Rs 498.00 apiece, up 25.4% from its IPO price of Rs 397, stock-exchange data show. The shares touched a high of Rs 517.00 in early trade, giving it a market value of Rs 20,866 crore ($2.35 billion), before easing a tad in a Mumbai market that was broadly flat.
The debut comes after Tenneco Clean Air's IPO was covered 58.8 times, with institutional investors bidding for 166 times the portion reserved for them.
US-based private equity firm Apollo Global Management has reworked the initial public offering plan of an Indian auto components supplier that joined its portfolio about three years ago, seeking to take out more money than previously planned and opting for a conservative valuation target compared with its listed peers.
The IPO didn't include any fresh issue of shares by the company and comprised only an offer for sale by Apollo-owned Tenneco Mauritius Holdings Ltd, its parent company. Tenneco Mauritius, part of American auto components manufacturer Tenneco Group, sold a stake worth Rs 3,600 crore, up from Rs 3,000 crore planned earlier when it filed its draft papers to float the IPO.
Ahead of the IPO, Tenneco Mauritius sold a 2.75% stake of Tenneco Clean Air late last month for a total of Rs 440 crore. It sold the shares to alternative investment funds managed by SBI Funds Management, Axis Mutual Fund, 360 One, WhiteOak Capital, ValueQuest, and 3P Investment, among others.
Tenneco Clean Air was incorporated in December 2018, though its origin dates back to 1979 when its previous avatar set up its first factory in India. It makes suspension and powertrain components, and catalytic converters for automakers. The company joined Apollo's portfolio in 2022 when the PE firm acquired Tenneco Inc in an all-cash transaction with an enterprise valuation of about $7.1 billion, including debt, and delisted the US company from the New York Stock Exchange. That deal came four years after Tenneco itself acquired Federal-Mogul LLC from Icahn Enterprises in a deal that also added Mumbai-listed Federal-Mogul Goetze India Ltd to its network.
The company's listed peer group includes the local units of Germany's Bosch, American's Timken, and Sweden's SKF, apart from Indian companies such as Sona BLW, Uno Minda and Samvardhana Motherson.
Published by HT Digital Content Services with permission from VC Circle.