TVS Group company Wheels India has said it would continue to hold management control. The announcement comes at a time when its foreign partner is planning to increase its stake through an open offer, which may lead it to a majority stakeholder.
Meanwhile, the company has got the board’s approval to raise Rs 100 crore through a public issue. It may dilute around 5 per cent through the issue.
Srivats Ram, managing director, Wheels India, said, the fund-raising was to meet fresh capital requirements and would also help the company meet the deadline of Securities and Exchange Board of India (Sebi) for listed companies to have at least 25 per cent equity held by non-promoters.
The approval is for the public issue of equity capital (including premium) up to Rs 100 crore.
“We want to improve our debt-equity ratio and bring working capital to the company for which we decided for public issue,” said Ram.
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At present, the company’s debt is around Rs 400 crore.
The company’s foreign partner Titan Europe Plc, which is currently a 35.91 per cent shareholder in Wheels India, is planning to increase its stake. The acquisition will be through an open offer to acquire 1.42 million shares constituting 14.38 per cent of the fully-diluted voting equity share capital of Wheels India Ltd from public shareholders.
Once, the open offer concludes successfully, the shareholding of Titan Europe would go up to 50.29 per cent in the company while Indian promoters, including T V Sundaram Iyengar & Sons Ltd, Sundaram Finance Ltd and Southern Roadways Ltd will hold the rest.
