Jatias To Exit Wimco, Sell 22% Stake

The Jatias-have decided to virtually pull out of match manufacturers Wimco Ltd. The group has decided to sell off its 22 per cent equity stake in the company to Sweden based Swedish Match AB.

As a result of this move Swedish Match which has a 52.1 per cent equity stake in Wimco will raise its holding to over 74 per cent. The remaining equity in the company is held by financial institutions and other shareholders including the public.

In its application to the Foreign Investment Promotion Board the company has mentioned that the Jatias have decided to dispose off their shareholding for strategic reasons. The FIPB has approved the proposal in its meeting recently.

 

The Swedish company through its subsidiary Haravon Investments, Singapore, will increase its equity through a transfer of shares from two Jatia owned companies _ AVB Trading and Plashfood Pvt Ltd.

Swedish Match will buy 11,382,800 shares of Wimco from these two companies.

Wimco had earlier applied to the government and had received approval to increase the foreign holding in the company with Swedish Match from 38.61 per cent to 52.11 per cent by way of issue of 1,55,68,238 new equity shares of Rs 10 each on a preferential basis in the paid up equity capital of the company to a subsidiary of Swedish Match.

The government had given approval to the proposal subject to the condition that it would go in for dividend balancing on the difference between the enhanced and the previous foreign equity (13.5 per cent equity).

The fortunes of Wimco have gone through numerous changes. Ashok Chaturvedi promoter of Flex Industries had initially made a bid to buy controlling stake in the company, but the deal did not work out.