India Glycols Ltd (IGL, “Company”) will sell entire investment in equity and Preference shares in Subsidiary Company namely Shakumbari Sugar and Allied Industries Limited (“subsidiary company” or “SSAIL”). The sale is contemplated in 1 or more tranches to be completed on or prior to 31 May 2023, subject to terms and conditions (including fulfillment of conditions precedent) of the SPA and other relevant transaction documents.
A Share Purchase Agreement (“SPA”) and other relevant transaction documents (collectively, the “Transaction Documents”) have been executed by the Company on 30thMarch, 2023 with Faith Mercantile Private Limited, Meir Commodities India Private Limited and R K and D Investment Private Limited (collectively, the “Acquirers”). None of the Buyers relates to promoter/promoter group.
Under the terms of the agreement, SSAIL will repay entire Intercorporate Deposits.
The detailed documentation relates to the sale of:
(i) 98.885% equity shareholding of SSAIL;
(ii) 100% preference shareholding of SSAIL held by the Company and other selling shareholder of SSAIL; and
(iii) repayment of entire Intercorporate deposits (received from various entities) of SSAIL (“ICD’s”).
In terms of the Transaction Documents, the Acquirers have agreed to invest Rs. 87,50,00,000 (Rupees Eighty-Seven Crores Fifty Lakh Only) (“Consideration”), subject to certain pre-closing and post-closing adjustments (including adjustment for working capital, interest, etc.) in accordance with the terms of the Transaction Documents, which shall be utilized in the manner set out below:
(i) Rs. 86,89,88,790 (Rupees Eighty Six Crores Eighty Nine Lakhs Eighty Eight Thousand Seven Hundred Ninety Only) shall be invested by the Acquirers in the form of loans and advances, which is required to be utilized by SSAIL for repayment of the entire outstanding ICDs. In this regard, the Acquirers have given an advance amount of Rs. 53,90,00,000 (Rupees Fifty Three Crores Ninety Lakhs) to SSAIL as of 30 March 2023 towards part repayment of the ICD’s, and the balance amount will be provided to SSAIL pursuant to the terms of the Transaction Documents;
(ii) Rs. 50,11,210 (Rupees Fifty Lakhs Eleven Thousand Two Hundred Ten only) towards acquisition of 98.885% of the total equity shares issued by SSAIL, of which: (a) Rs. 25,86,210 (Twenty Five Lakhs Eighty Six Thousand Two Hundred and Ten) will be received by the Company for transferring its entire 51.03% equity shareholding (i.e 2,58,62,100 shares); and (b) the remaining amount of Rs. 24,25,000 (Rupees Twenty Four Lakhs Twenty Five Thousand only) will be received by the other selling shareholder of SSAIL, in proportion to its respective holding of equity shares of SSAIL.
(iii) Rs. 10,00,000 (Rupees Ten Lakhs only) towards acquisition of 100% of the total preference shares issued by SSAIL, of which: (a) Rs. 5,10,000 (Rupees Five Lakh Ten Thousand only) will be received by the Company for transferring its entire 51% preference shareholding (i.e. 51,00,000 shares) in SSAIL; and (b) the remaining amount of Rs. 4,90,000 (Rupees Four Lakh Ninety Thousand only) will be received by the other selling shareholder of SSAIL, in proportion to its respective holding of preference shares of SSAIL.
The Acquirer has given an advance of Rs. 5,00,000 each to the Company and the other selling shareholder towards acquisition of their respective equity shares issued by SSAIL towards payment of the consideration, and the remaining consideration due to each of the Company and other selling shareholder will be paid in 1 or more tranches in terms of the Transaction Documents.
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