Dhoots Tightening Grip On Arms Via Preferential Issue

The promoters' holding in the case of the former is 23 per cent without taking into consideration GDR voting rights, while in the case of the latter, it is 19 per cent. Both these companies are seeking shareholders approval at their forthcoming AGMs.

The Rs 1646.88-crore Videocon International makes colour TVs, audios and refrigerators, while the Rs 448.76-crore Videocon Appliances manufactures washing machines, air conditioners and refrigerators. As per the special resolution, both these companies intend to issue 50 lakh warrants each to the promoters. Each warrant, in both Videocon International and Videocon Appliances, will be converted into one equity share of Rs 10 each within 18 months from allotment.

 

The basis of conversion as per Sebi's new guideline will be based on the average market price during the six months preceding conversion.

The preferential allotment is being done to strengthen the holding of promoters in both the companies. The other resolution that will be moved at the AGM is the company buying its own shares. In light of this, the companies articles of association are being amended to buy its own shares as well as allot non-voting shares when law permits.

In the case of Videocon VCR, the company proposes to amend the articles of association so as to incorporate a provision enabling the issuance of non-voting shares and allow buyback of its owns shares. Here the promoters don't intend to increase their holdings.

Videocon International, the group's flagship, is planning to set up three production units in the country at a cost of Rs 600 crore.The company's technical partner Toshiba is expected to pick financial stake.

The company earned a net profit of Rs 90.45 crore on a turnover of Rs 1,646.88 crore. Videocon Appliances reported a 33.38 per cent jump in sales to Rs448.76 crore for the year ended March 1996.