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PUBLIC ANNOUNCEMENT TO THE SHAREHOLDERS OF THE KIRLAMPUDI SUGAR MILLS LIMITED This Public Announcement is being issued by Ashika Credit Capital Ltd. (hereinafter referred to as "ACCL" or "the Manager to the Offer"), for and on behalf of Sri. C. Raghuram (hereinafter referred to as "the Acquirer") pursuant to Regulation 10 & 12 in compliance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 1997 and subsequent amendments thereto (the “Regulations”). The Offer a. a. Sri. C.Raghuram is the Acquirer. There is no Person Acting in Concert (PAC) with the Acquirer for the purpose of the Offer. b. b. The Acquirer has entered into a Share Purchase Agreement (“The Agreement”) on February 18, 2002 with M.R. Holdings Ltd (99,000 Equity Shares); Abhyuday Investments Ltd. (99,000 Equity Shares); and Nalanda Consultants Pvt. Ltd. (79,700 Equity Shares) [Promoter Group] (hereinafter collectively referred to as “Vendors”) to acquire in aggregate 2,77,700 Fully Paid-up Equity shares of Rs. 10/- each of The Kirlampudi Sugar Mills Limited ("KSML") representing 69.43% of the Subscribed Share and Voting Capital at a price of Re.1/- per share ("Negotiated Price") payable in cash ("The Acquisition"). c. c. The Acquirer is now making this Open Offer (the “Offer”) to the Shareholders of KSML (other than the parties to the Agreement) to acquire up to 62,250 [15.56%] fully paid-up equity shares of Rs.10/- each at a price of Rs.2/- per equity share (“Offer Price”) and 1,800 [4.50%] fully paid-up 5 ˝% Income Tax Free Cumulative Preference Shares [voting rights triggered in the year 1977-78] of Rs. 100/- each at a price of Rs.20/- per such Cumulative Preference share (“Offer Price”) aggregating to 20.06% of its Paid up Share and Voting Capital, payable in cash. d. d. The Offer is unconditional and not subject to any minimum level of acceptance. e. e. The Acquirer has not acquired any shares of KSML in the past. The Equity Shares of KSML are listed at the Hyderabad Stock Exchange Limited (HSE). Based on the information available, the shares of KSML are infrequently traded within the meaning of Regulation 20 (3) of the Regulations. Therefore, while determining the Offer price, in accordance with the Regulations, the following financial parameters of the KSML have been considered for the year ended March 31, 2001: Return on Net Worth - Negative; Book Value per share - Negative; Earnings Per Share – Nil; P/E multiples – Infinite [based on the offer price] and Industry P/E Multiple – 4.10 [Source – Dalal Street, Volume XVII No. 2, Dated January 27, 2002, Industry –Sugar - Integrated]. In view of the aforesaid financial parameters, the offer price is justified in terms of Regulation 20 of the Regulations. f. f. The Acquirer does not hold any shares in the KSML as on the date of Public Announcement. g. g. This is not a competitive bid. Information about Acquirer
Information about the Target Company
Reasons for the Acquisition and Offer
Statutory Approvals/ Other Approvals required for the Offer a. a. The Acquirer will make the requisite application to the Reserve Bank of India ("RBI") to obtain permission under the Foreign Exchange Management Act, 1999 ("FEMA") and subsequent amendments there to for acquiring shares from the Non Resident/NRI/FII/OCB shareholders of KSML. b. b. The Acquirer does not require any other statutory approvals for the purpose of the Offer. c. c. In case of non-receipt of statutory approvals within time, SEBI has a power to grant extension of time to acquirer for payment of consideration to the shareholders, who have accepted the Offer, subject to Acquirer agreeing to pay interest as directed by SEBI under Regulation 22(12) of the Regulations. De-listing option to the Acquirer In case the public share holding falls to 10% or less, after the Offer, the Acquirer in compliance with Regulation 21 (3) of the Regulations, will seek to comply with the listing requirement by disinvestments through an offer for sale and/or by making a fresh issue of capital to the public which shall open within a period of 6 months from the date of closure of this Offer. Financial Arrangements
Other terms of the Offer a. a. The Letter of Offer together with the Form of Acceptance cum Acknowledgement will be mailed to all those shareholders of KSML (other than the parties to the agreement) whose names appear on the Register of Members of KSML at the close of business hours on 22.02.2002 (the "Specified Date"). b. b. Persons who are shareholders of KSML but are not registered or who have sent their shares for transfer or shareholders who have not received the Letter of Offer and who wish to accept the offer should send their application in writing on plain paper with the following information: Name & Address of the first holder, Name(s) & address(s) of joint holders(s) if any, Regd. Folio No., Share Certificate No., Distinctive Nos., No of Shares offered. The said application should be sent to Registrar to the Offer. Alternatively, shareholders who have not received the Letter of Offer & Form of Acceptance may obtain a copy of the same (on providing suitable documentary evidence like folio number, share certificate number, distinctive numbers etc.) from Registrar to the Offer. c. c. All owners of shares, registered or unregistered (who own the shares any time prior to the closure of the Offer), are eligible to participate in the offer. Unregistered shareholders / owners of shares who have sent shares for transfer should send to the Registrar to the Offer the following documents as applicable to them along with the acceptance cum Acknowledgement: (a) Original share certificate(s), (b) Original broker contract note, (c) Valid share transfer form(s) as received from the market. No indemnity is required from unregistered shareholders. d. d. Shareholders who wish to accept the offer and tender their Equity Shares, will be required to send their (i) duly signed Form of Acceptance, (ii) original share certificate(s), (iii) duly signed and executed transfer deed(s) and other documents to the Registrar to the Offer, in accordance with the instructions specified in the Letter of Offer and on the Form of Acceptance. e. e. In case the number of shares validly tendered in the Offer by the shareholders of KSML are more than the shares to be acquired in this Offer, then the Acquirer will accept shares on a proportionate basis subject to a minimum of 50 Shares, or the entire holding if less than 50 shares from each shareholder accepting this Offer, as per the provisions of the Regulations. The rejected applications/documents will be sent by Regd. Post. f. f. The payment for the acquisition of the shares will be made by the Acquirer in cash through a crossed Demand Draft/Pay order to the equity shareholders of KSML whose equity share certificates and other documents are found in order and accepted, within 15 days from the date of closure of the Offer. g. g. The Acquirer undertakes to pay interest Pursuant to Regulation 22 (12) to the shareholders for the delay, if any, in payment of consideration. h. h. Attention of the shareholders is invited to the fact that the Letter of Offer along with the form of Acceptance would also be available on the SEBI web site at www.sebi.gov.in and eligible persons may download the Form of Acceptance cum Acknowledgement from the website for applying in the offer. i. i. The schedule of the activities pertaining to the Offer are given below: -
General a. a. Shareholders who have accepted the Offer by tendering the requisite documents, in terms of the Public announcement / Letter of Offer, cannot withdraw the same. b. b. (i) The Acquirer can revise the Price upwards up to 22.04.2002 and revision, if any, in the Offer price would appear in the same newspapers where this Public Announcement appeared and the same price would be paid to all shareholders who tender their shares in the Offer. (ii) If there is Competitive Bid: · · The public offers under all the subsisting bids shall close on the same date. · · As the offer price cannot be revised during 7 working days prior to the closing date of the offers/ bids, it would, therefore, be in the interest of the shareholders to wait till the commencement of that period to know the final offer price of each bid and tender their acceptance accordingly. c. c. Neither the Acquirer nor Vendors and/or KSML has been prohibited by SEBI from dealing in securities, in terms of direction issued u/s 11B of SEBI Act. d. d. Attention of the shareholders is invited to the fact that this Public Announcement will also be available on the SEBI website at www.sebi.gov.in e. e. Pursuant to Regulation 13 of the Takeover Regulations, the Acquirer has appointed Ashika Credit Capital Limited, Hyderabad, a Category 1 Merchant Banker, as Manager to the Offer. f. f. the obligations of Acquirer laid down in SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 1997 and subsequent amendments thereof. Issued by Manager to the Offer on behalf of the Acquirer Ashika Credit Capital Ltd. [Contact Person: Mr.Rajendra Kanoongo] 408, Taramandal Complex Near Secretariat, Saifabad Hyderabad-500 004. Tel: 040- 6617802 / 03 Fax: 040-6617801 E-Mail: ashika_hyderabad@rediffmail.com Place: Hyderabad Date: 20.02.2002. | |||||||||||||||||