Earlier this month, the Poonawalla Group and Magma Fincorp introduced that the group will purchase a controlling 60 per cent stake in the corporate by means of a Rs 3,456-crore-worth preferential difficulty of shares.
Besides Rising Sun, Magma Fincorp will allot preferential shares to two members of the promoter group — Sanjay Chamria and Mayank
— for Rs 250 crore, taking the whole capital infusion in th firm to Rs 3,456 crore.
The preferential allotment represents 64.68 per cent of Magma’s enhanced fairness share capital post-issue and based mostly on the present shareholding, Rising Sun will maintain 60 per cent stake and the present promoter group’s stake will come down to 13.3 per cent.
The promoter and promoter group presently maintain 24.39 per cent in Magma.
Axis Capital, which has been appointed because the supervisor for the open offer by the three buying entities, submitted particulars in regards to the open offer to the inventory exchanges on Wednesday.
The open offer is to purchase up to 19,88,32,105 fairness shares, constituting 26 per cent of the expanded voting share capital at a worth of Rs 70 apiece. The complete consideration could be little over Rs 1,391.82 crore, as per an offer doc submitted by Axis Capital.
As per Sebi norms, pursuant to substantial acquisition of shares or change in management in a listed firm, an acquirer has to make an offer to the general public shareholders in order to give them a good alternative to exit the corporate.
Under the proposed deal, Magma Fincorp proposes to allot 45.80 crore or 60 per cent shares to Rising Sun, and three.57 crore shares to Chamria and Poddar.
Chamria is the Vice Chairman and Managing Director of Magma Fincorp and Poddar is the Chairman Emeritus and a Non-Executive Director of the Kolkata-based firm. Magma Fincorp has convened a gathering of shareholders subsequent month to search their approval for the proposed deal.
Pune-based Poonawalla Group additionally owns vaccine maker Serum Institute of India and Poonawalla Finance, which lends principally to professionals.
Upon the completion of the deal, Rising Sun Holdings could be categorised as promoter of Magma Fincorp along with the present promoter group.
Also, Rising Sun Holdings will nominate Poonawalla because the Chairman of the board whereas Abhay Bhutada — presently MD and CEO of Poonawalla Finance — is proposed to be appointed because the Managing Director.
Chamria will proceed on the board because the Executive Vice Chairman. Magma Fincorp and its subsidiaries shall be renamed and branded below the Poonawalla Finance model.
Magma Fincorp’s Asset Under Management (AUM) stood at Rs 15,006 crore on the finish of December 2020.
Shares of the corporate rose 4 per cent to shut at Rs 113.45 apiece on the BSE.
In a separate submitting to inventory exchanges, Magma Fincorp stated scores company Icra has positioned the corporate’s long run fund based mostly time period loans (ICRA AA-) on watch with growing implications.
“The proposed capital infusion could be a constructive for the group’s capitalisation profile and would offer capital for each absorbing losses in addition to fund development over the medium time period.
“The transaction is subject to regulatory approvals and Icra would monitor the developments on this transaction and would take suitable rating action once it has clarity on the proposed business model of the company and the likely impact on the various credit metrices, and other organisation-related changes,” the score company stated.