Meesho faces investor protest over anchor allotment to SBI Funds
The Indian e-commerce industry has been abuzz with the upcoming initial public offering (IPO) of Meesho, a social commerce platform that has been making waves in the country’s online retail space. However, the company’s anchor book has faced a significant setback after a large allocation to SBI Funds Management, prompting several other big-ticket investors to withdraw their investments in protest. Despite this, Meesho’s IPO lineup still boasts an impressive array of global investors, including GIC and BlackRock.
According to reports, Meesho’s anchor book had initially seen significant interest from several large investors, including Capital Group, Aberdeen Group, ICICI Prudential Asset Management, and Nippon India Life Asset Management, among others. However, when the company announced a substantial allocation to SBI Funds Management, these investors decided to withdraw their investments in protest. The reason behind this sudden withdrawal is believed to be the perceived favoritism shown to SBI Funds Management, which has raised concerns about the fairness and transparency of the allocation process.
The anchor book is a critical component of any IPO, as it provides a snapshot of the company’s potential investor base and helps to gauge the demand for the issue. Anchor investors are typically large institutional investors who are allocated a significant portion of the IPO shares before the issue opens for subscription to the public. Their participation is seen as a vote of confidence in the company and can help to attract other investors to the issue.
In Meesho’s case, the anchor book had been seen as a major positive, with several large investors expressing interest in the company’s IPO. However, the allocation to SBI Funds Management has raised questions about the company’s allocation strategy and has prompted several investors to reevaluate their investment decisions.
Despite the withdrawal of several large investors, Meesho’s IPO lineup still includes several prominent global investors, such as GIC and BlackRock. These investors have reportedly been allocated a significant portion of the IPO shares and are expected to provide a significant boost to the issue.
The controversy surrounding Meesho’s anchor allotment to SBI Funds Management has raised questions about the company’s corporate governance practices and its relationship with institutional investors. While the company has not made any official comments on the matter, it is clear that the issue has caused significant discomfort among investors and has raised concerns about the fairness and transparency of the allocation process.
The incident also highlights the challenges faced by companies in managing their relationships with institutional investors, particularly during the IPO process. The allocation of shares to anchor investors is a critical decision that can have a significant impact on the success of the issue. Companies must balance the need to attract large investors with the need to ensure that the allocation process is fair and transparent.
In conclusion, Meesho’s IPO has hit a roadblock after several large investors withdrew their investments in protest over the company’s anchor allotment to SBI Funds Management. While the company’s IPO lineup still includes several prominent global investors, the controversy has raised questions about the company’s corporate governance practices and its relationship with institutional investors. As the company moves forward with its IPO plans, it will be important to address these concerns and ensure that the allocation process is fair and transparent.
About the Author
