New Delhi-based diversified company Prakash Industries on Monday announced preferential issue of warrants worth Rs 44.44 crore to Barclays and a few domestic investment firms.
The Rs 1,000-crore firm said it would allot 5.55 million warrants to Barclays and “others”, subject to the permission of its shareholders. The warrants would be priced at Rs 80 apiece and they could be converted into equal number of equity shares within 18 months.
Last year, Prakash Industries posted a net profit of Rs 133 crore on a turnover of Rs 1,048 crore. It is engaged in the steel, power, PVC pipes and black and white picture tubes businesses.
M&A DEALS FROM AUGUST 17 TO 23
Bidder
Target
Sector
Value
Stake%
Type
Noor Investment, Ikarus Petro, KuwaitPrivatisation Project Investment, US-based
Lamb Company, NRI Investor
Delhi Stock Exchange
Financial Services
NA
21
PE/VC
Lehman Brothers
ECL Finance
Financial Services
45
26
PE/VC
The Blackstone Group
Gokaldas Exports
Consumer Goods
116
50.1
PE/VC
Greylock Partners and other unnamed Investors
TechProcess
Internet/ Ecommerce
NA
NA
PE/VC
Indecomm Global Services
Brainvisa Technologies
IT/ITeS
NA
100
Strategic/domestic
Dubai Ventures
Time BroadbandServices
Internet/ Ecommerce
NA
40
Strategic/domestic
Primus Retail
Weekender
Consumer Retail
9.5
100
Strategic/domestic
Standard Chartered
UTI Securities
Financial Services
36
49
Strategic/inbound
Baosteel trading and Visa Comtrade
Visa Bao
Industrial Products and Services
NA
49
Strategic/inbound
Cobra Beer
Regal Breweries
Consumer Goods
NA
76
Strategic/inbound
Educomp Solutions Limited
Authorgen Technologies
Education/ Elearning
NA
51
Strategic/outbound
ITC's Russell Credit
Technico Pty. Limited
Agri- Biotechnology
100
Strategic/outbound
JSW Steel
Jindal United Steel Corporation, Saw Pipes (US), Jindal Enterprises
Source: Public information and PricewaterhouseCoopers analyses NA=not available
The company did not divulge the identity of other investment companies.
When contacted, Prakash Industries’ company secretary Manoj Kumar Agarwal said they would furnish other details to the stock exchanges later. Agarwal declined to comment on the speculation that a big conglomerate was among the investment companies subscribing to the preferential issue.
According to Agarwal, the company would seek the shareholders’ permission on the proposed transaction at an extra-ordinary general meeting on September 19.
Under the capital market regulations, the investors will have to fork out 10 per cent of the total investment at the time of subscription of the issue and the remaining 90 per cent at the time of conversion.
Post conversion of the warrants, the promoters’ stake in the company will come down. However, the exact details of the promoters’ shareholding, post conversion of warrants, could not be ascertained. Agarwal said, “We will inform the details in the notice of the EGM.” The promoters now hold 67 per cent, he said.
Share prices of Prakash Industries jumped 5 per cent – the maximum permissible increase of the stock in a trading session – to Rs 87.70 on the BSE.
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