Groww Secures CCI Approval for Bonus Shares Ahead of Public Listing
Fintech startup Groww has recently been granted approval by the Competition Commission of India (CCI) to issue bonus shares to its current equity shareholders. This approval marks a significant step as Groww, which has made strategic shifts in its corporate structure, gears up for its forthcoming public listing in India.
Details of the CCI Decision
The CCI’s order allows for the acquisition of additional voting rights by select shareholders of Billionbrains Garage Ventures Private Limited, Groww’s parent company. Furthermore, it facilitates the issuance of bonus compulsorily convertible preference shares to all existing equity shareholders. Notably, prominent investors such as Tiger Global, Peak XV Partners, Y Combinator, Ribbit Capital, and Iconiq Strategic Management are highlighted in the CCI’s order.
Adjustments to Voting Rights
In a move toward governance alignment, the CCI has also sanctioned the removal of differential voting rights that were previously held by the founders of Groww. This change is expected to synchronize their voting power with that of other shareholders, fostering a more unified corporate governance structure. Groww was founded by former executives of Flipkart: Lalit Keshre, Harsh Jain, Neeraj Singh, and Ishan Bansal.
Strategic Moves Ahead of IPO
Groww’s application to the CCI was submitted on March 4, emphasizing that the adjustments were of a technical nature and would not alter the existing management control given that current investors hold substantial stakes in the company. As it prepares for its public offering, Groww is aiming for a valuation that ranges from $6 billion to $8 billion. Reports indicate that the startup is seeking to raise around $200 million in equity funding prior to its market debut, potentially settling at a valuation of approximately $6.5 billion.
Expansion Plans
Beyond its stockbroking and mutual fund distribution services, Groww is enhancing its offerings in wealth management through a new division, referred to as ‘W’. Additionally, the company is exploring opportunities for inorganic growth, including discussions reported in mid-March for a potential acquisition of wealth-tech startup Fisdom.
