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Essar Oil's small investors to get Rs 75.48 more over delisting price

The total payment of around Rs 880 crore will be in addition to the Rs 3,064 crore

Aditi Divekar  |  Mumbai 

Essar House
Essar House

Promoters of Ltd (EOL), Essar (EEHL) and (Mauritius) Limited (OBML) said on Tuesday that the former minority shareholders, who tendered EOL shares in the offer, will be paid an additional amount of Rs 75.48 per share, following the closure of the sale transaction with Rosneft and the Trafigura-UCP consortium. 

The total payment of around Rs 880 crore will be in addition to the Rs 3,064 crore that had paid to the minority following EOL’s in 2015. 

“This transaction (Essar-consortium) has created many records and the additional payout to over and above the price is another first in the history of corporate India. This resonates with our philosophy of rewarding handsomely,” Essar founder Shashi Ruia was quoted as saying.

The promoters will shortly issue a public notice in this regard and as committed in the offer of December 2015, the additional payout will be made within two months thereafter. 

EOL was valued at Rs 2,000 crore around the time of its listing in 1995, and has now been valued at about Rs 50,400 crore, a growth of 2420 per cent. This value creation was made possible through continued strategic investments and growth of the businesses since commencement. 

“The additional payment to minority is unprecedented as they got exit and liquidity upon in December 2015, retained the upside from the transaction that has closed 20 months later, without carrying any downside risk,” Dhanpat Nahata, director at EEHL, was quoted as saying.

Of the 14.25 crore shares held by public shareholders, acquired 11.66 crore shares through the offer (including during the one year exit window) made to shareholders, against the requirement of 9.26 crore shares for While the floor price for the was set at Rs 146.05 per share in accordance with a Sebi-mandated formula, agreed to pay Rs 262.80 per share, which was a premium of 80 per cent over the Sebi-mandated formula. Now, with the additional payout, the total price paid represents a premium of about 132 per cent.

First Published: Wed, August 23 2017. 00:21 IST