Boat, a business-to-business (B2C) audio and wearable device brand, has closed $60 million in convertible bonds from existing investor Warburg Pincus and new investor Malabar Investments.
The bot has set a minimum valuation threshold of around $1.2 billion for these funds, people familiar with the terms of the transaction told ET. This means that whenever The boat closes its next funding round or goes public, India-focused investment funds Warburg and Malabar will convert those bonds into stocks with a business value of $1.2 billion.
“The notes will be priced to either the IPO or the next funding round though chances of the former are higher, Existing investors and incoming investors are signing up now as they will get a discount on pricing now.” one the people cited above said.
Due to this fundraising, the Delhi-based company’s Draft Conversion Prospectus (DRHP) submitted to the Securities and Exchange Commission (Sebi) of India for its planned IPO has been withdrawn.
“The market condition remains very choppy but the intent is quite clear to access the markets shortly when the conditions are conducive, While there is no set timeline, I think it would be sometime shortly.” company CEO Vivek Gambhir stated.
Gambhir said the goal of the fundraising event is to expand the brand’s presence in the smartwatch category by investing in India’s branding, design, R&D, and manufacturing capabilities while reducing debt.
According to the latest data from market research firm IDC, watch-based wearables were the fastest-growing category for wearables from April to June, with shipments nearly quadrupling from 1.6 million units a year earlier to 6.4 million units. last quarter.
Data shows that boat share fell from a second place among smartwatches as their market share fell to 19.7% during the quarter from 26.9% in the same period last year. Competitor Fire-Boltt’s market share increased significantly from 5.5% a year ago to 24.8% in the June quarter. Market leader Noise maintained the No. 1 position with a 28.5% share, down slightly from 28.6% in April-June 2021.
Much of the growth in this sector is attributable to rising health awareness and falling smartwatch prices after the COVID-19 pandemic.
“The initial set of smartwatches were fitness bands, which did not take off in India. Covid gave a fillip to this segment. There was more awareness of health, particularly SPO2, and the prices have also been coming down,” he said.
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