Nestle Wants To Hike Stake In Indian Subsidiary By 10%
Nestle SA Group is seeking the permission of the government to raise its stake in its Indian subsidiary, Nestle India, by 10 per cent using the creeping acquisition route. The Swiss parent currently holds a 53.96 per cent stake in Nestle India. The creeping acquisition, if allowed by the government, can take the stake up to 63.96 per cent.
Subject to necessary approvals being received, the purchase of equity shares of Nestle India would be to the extent of shares available at a price which is acceptable to Nestle SA, Switzerland. Nestle India has informed the Bombay Stock Exchange of the development.
A Nestle India spokesperson told Business Standard that this was just an enabling provision and it is upto Nestle SA to decide as and when it wants to exercise the option.
Apart from the promoter, foreign institutional investors hold 7.8 per cent shares in Nestle India, while banks etc hold around five per cent, mutual funds around nine per cent and the public, 23.7 per cent.
The request from the Swiss parent comes eight months after the Nestle India board of directors approved a proposal for a buyback of company