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Owing to regulatory requirements, the Shiv Nadar Foundation offloaded 56 million shares worth Rs 1,150 crore in HCL Technologies on Monday, constituting 0.79 per cent stake in the company.
The Foundation is the philanthropic arm of the group, h supported by donations from HCL Corporation and its associates. After Monday’s transaction, the Foundation doesn’t hold any shares in HCL Technologies.
The company’s shares ended at Rs 2,067.35, up by 0.1 per cent from the previous close, on a day when the BSE dropped by 604.17 points or two per cent to end at 28,844.7 points.
Pawan K Danwar, chief financial officer of the Foundation, said public charitable trusts get tax exemptions or waivers but subject to conditions. The Foundation had received the shares in HCL Technologies as a donation from HCL Corporation in 2013. Under income tax rules, a trust should not hold shares in a company after the expiry of one year from the end of the previous year in which such shares are acquired.
The foundation also follows the April to March financial year and the sale coincided with budget planning for the next year. “These funds will also help the Foundation to meet its financial requirement for 2015-16 and the future years…So, a combination of various factors led to the sale,” added Danwar.
“This transaction has been concluded at one go, at a discount to the last closing price of HCL Technologies’ shares, to avoid any overhang in the market for (the latter’s) shareholders,” the company stated to the stock exchanges.
The previous sale of shares in HCL Technologies by the Foundation was in February 2012.
In 2013, founder and chairman of HCL Corporation Shiv Nadar had committed Rs 3,000 crore of his personal wealth to furthering the causes of the Foundation which runs several educational institutions over the next five years.
The Foundation’s initiatives include VidyaGyan schools in Uttar Pradesh, SSN Institutions in Tamil Nadu and Shiv Nadar University in Greater Noida. Set up in 1994, it had made investments of Rs 1,800 crore till March 2013. However, the institution has not made public its investments since then. It has also not provided specifics of the how the proceeds from the current share sale will be used.
