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TMCNet:  FSS Tech gets into fundraising mode [Software & Services] [Times of India]

[January 03, 2014]

FSS Tech gets into fundraising mode [Software & Services] [Times of India]

(Times of India Via Acquire Media NewsEdge) CHENNAI: Privately-held Financial Software Systems (FSS) has chalked ambitious plans, whereby it is looking at growing its topline from Rs 570 crore in March 2013 to nearly Rs 2,250 crore by 2018-19. Towards achieving this, the payment systems company will raise Rs 350 crore as equity from private equity investors , potentially the last before the company goes public. "We will need Rs 1,000 crore over the next two to three years. Of this, Rs 350 crore would come in by way of equity, the process for which has already begun with Avendus Capital helping us," Nagaraj V Mylandla, founder and MD of the company said.


The information memorandum or IM would get circulated from Thursday. The company hopes to finish the exercise over the next 3 to 4 months. Also, the company has signed debt agreements with Axis bank for nearly Rs 650 crore. "These will be in the form of term loans and cash credit. Together with Rs 350 crore equity and this debt syndication, our funding requirement will be complete," he said.

The company which offers a range of services for banks and financial institutions, in the areas of electronic payment , financial transaction processing solutions, had raised three rounds of private equity money from Carlyle, New Enterprise Associates (NEA) and Jacob Ballas Capital India. "This is a fresh issue. None of the existing investors are exiting," he said.

The funds raised from this exercise would be used to ramp up 'next-gen' payment systems including Aadharlinked payments and Rupay.

The broad business plans envisages the company to increase its revenues from Rs 570 crore in March 2013 to Rs 725 crore in March 2014 to Rs 2,250-2 ,500 crore by 2018-19 . "The business plans has been validated Ernst & Young," Mylandla said.

Upon reaching the budgeted revenues of Rs 2,500 crore, FSS will look at public float. "The existing investors (NEA and Jacob Ballas Capital who came upon the exit of Carlyle are committed to stay with us for at least another three years when we could give them an exit option by way of an initial public offering (IPO)," he said.

(c) 2014 Bennett, Coleman & Company Limited

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