Shareholders approve Essar Oil delisting

Essar Oil's shareholders have approved delisting of the company form the bourses.

Essar Oil had announced delisting from the stock exchanges on June 20, 2014.

As per the transaction, Essar Group would buy all the shares it doesn't own in Essar Oil. The number of equity shares held by public shareholders are 137.123 million  or 27.53%. The promoter firm, Essar Energy Holdings (EEHL), incorporated under the laws of Mauritius, holds 71.22% stake in Essar Oil.

The floor price has been set at Rs 108.18. At this floor price, the Group will have to spend Rs 1,480 crore to acquire all outstanding shares.

Ruias, the promoters, plan to take the entire hydrocarbon business private as it would  provide EEHL with increased operational/financial flexibility to support the company's businesses and strategic needs.

In a recent report, Institutional Investor Advisory Services (IiAS) advised investors to vote for the delisting of Essar Oil and actively participate in the price discovery process.

IiAS, in its report, has sought shareholders to press for two commitments from company's board--- that the company will not re-list it’s shares in the next five years, and that it will not enter into a strategic divestment in the next three years.

Shares of Essar Oil were up 1.97% at Rs 116.70 on the Bombay stock exchange.