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Diversified FMCG company Ruchi Soya will launch its follow-on public offer on March 24. A follow-on offering is an issuance of additional shares made by a company after an initial public offering.
The issue will close on March 28. “The FPO comprises equity shares of face value of Rs 2 each aggregating to Rs 4,300 crore. The issue also includes a reservation of up to 10,000 equity shares for subscription by eligible employees. If such placement is completed, the follow-on size will be reduced,” it said in a statement.
In order to comply with market regulator, SEBI’s requirement of a minimum public shareholding of 25 per cent in a listed business, the company is issuing the additional public offering.
“It will take about three years to reduce promoters’ stake to 75 per cent. This FPO dilution will aid Swami Ramdev’s Patanjali Ayurveda, which owns Ruchi Soya, in adhering to the minimum shareholding rules.”
Currently, Patanjali Group owns about 98.9 per cent stake in Ruchi Soya. Public shareholders own about 1.1 per cent stake. Post the FPO, Patanjali Group’s holding in Ruchi Soya will come down to about 81 per cent and the public would hold about 19 per cent.
Entire proceeds from the issue will be used for furthering the company’s business by repayment of certain outstanding loans, meeting its incremental working capital requirements and other general corporate purposes, the statement said.
Ruchi Soya’s Ruchi Gold brand is the market leader in branded palm oil and also the pioneer of soya foods in India under the brand name Nutrela.
–IANS
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(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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