" This Document is important and requires your immediate attention"

This Letter of Offer is sent to you as a shareholder (s) of Kwality Dairy (India) Limited. If you require any clarifications about the action to be taken, you may consult your stock broker or investment consultant or Merchant Banker/ Registrar to the offer. In case you have recently sold your shares in the Company, please hand over this Letter of Offer and the accompanying Form of Acceptance cum Acknowledgement and Transfer Deed to the Member of Stock Exchange through whom the said sale was effected."

Cash Offer at Rs.2.00/- (Rupees two only) per fully paid up equity share
Pursuant to the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 and subsequent amendments thereof.
To Acquire 31,80,800 equity shares of Rs. 10/- each representing 17.48% of the paid up share capital of Kwality Dairy (India) Limited, having its Registered Office at Village Softa, Tehsil Palwal, Distt. Faridabad, Haryana -121 004, Tel:(0129)(2205323,2205332) [previous registered office 6 D, Park Plaza, 71 Park Street, Kolkata- 700 016 ] By Mr. Gulshan Dhingra , Mr. Krishan Dhingra, Mr. Naresh Dhingra and Mr. Sanjay Dhingra, all R/o 5/1-B Ramesh Nagar, New Delhi, Tel: (011) (25418600),Fax : (011) (25933400) (Acquirers)  The offer is not subject to any minimum level of acceptances. The offer is subject to approval from Reserve Bank of India ("RBI") under Foreign Exchange Management Act, 1999 ("FEMA") to purchase shares from non -resident shareholders.  To the best of Acquirers' knowledge there are no other statutory approvals required as on date hereof, to acquire the shares tendered pursuant to this offer. The Offer would be subject to all other statutory approvals that may become applicable at a later date before the completion of offer.  If there is any upward revision in the Offer by the Acquirers till the last date of revision i.e. 06.03.2003, the same would be informed by way of Public Announcement in "The Financial Express" and "Jansatta" i.e the newspapers where the original Public Announcement had appeared. Such revised Offer Price would be payable by the Acquirers for all the shares tendered any time during the offer. Shareholders who have accepted the offer by tendering the requisite documents, in terms of the Public announcement / Letter of offer, can withdraw the same upto three working days prior to the date of the closure of the offer. If there is any Competitive bid: The Public offers under all the subsisting bids shall close on the same date. As the offer price can not be revised during 7 working days prior to the closing date of the letter of 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.  A copy of the Public Announcement and this Letter of Offer (including form of acceptance cum acknowledgement) is also available on SEBI's website www.sebi.gov.in.
Manager To The Offer	Registrar To The Offer
Doogar & Associates Limited 13, Community Centre, East of Kailash, New Delhi-110 065 Tel:(011)26472557,26419079,26218274 Fax: (011) 26219491 Email :doogar@ndf.vsnl.net.in Contact Person: Ms. Anvita Awasthi & Ms Disha Doogar	Skyline Financial Services Private Limited 123, Vinoba Puri, Lajpat Nagar II, New Delhi-110 024 Tel:(011) 26847136 Fax: (011)26918352 Contact Person: Mr. Subhash Agarwal

1. DISCLAIMER CLAUSE

2.1.Background of the offer

2.1.1.The Offer is made in accordance with Regulation 10 and 12 of the Regulations.

2.1.2.The pre acquisition holding of the Promoters/ persons having control over the company including their heirs, executors, successors, associates, associate companies, administrators, nominees, legal representatives and assigns is 1,53,56,100 fully paid up equity shares of Rs. 10/- each representing 84.37% of subscribed and issued share capital/voting capital .

Out of the above mentioned issued share capital/ voting capital, the Acquirers have entered into an Acquisition Agreement dated 11.12.2002 with Promoters/ persons having control over the Company i.e. Kwality Ice creams (India) Limited (KICL) and Pradeep Wig, collectively referred to as "Sellers", to acquire 1,50,19,200 fully paid up equity shares of Rs. 10/- each of KDIL representing 82.52 % of subscribed and issued share capital/voting capital at a price of Rs.0.50 /- (Fifty paise only) per fully paid up equity share.

2.1.3.Promoters and other Associates holding 3,36,900 fully paid up equity shares of Rs. 10/- each representing 1.85% of the paid up/ voting equity capital are not parties to the agreement dated 11.12.2002 and therefore, are eligible to participate in the present offer alongwith the public.

2.1.4.As on date of this letter of offer, the Acquirers are holding nil equity shares of Rs10/- each, representing nil% of the subscribed and paid up /voting share capital of KDIL.

2.1.5.Assuming full acceptance of the offer, the post acquisition holding of the Acquirers in KDIL would be 1,82,00,000 shares representing 100% of paid up /voting capital of KDIL.

2.1.6.The Acquirers , sellers and the target company have not been prohibited by SEBI from dealing in securities, in terms of directions issued under section 11B of the Securities and Exchange Board of India Act, 1992 or under any other regulations made under the Securities and Exchange Board of India Act, 1992.

2.1.7.As of now Mr. Jagdish Ajmani represents the Acquirers on the Board of Directors of KDIL.

2.1.8.The Acquirers have not acquired any shares in KDIL in the past 12 months.
 
 

2.2.Details of the proposed offer

1. Mr. Gulshan Dhingra S/o Late Mr. J.R. Dhingra, R/o 5/1-B Ramesh Nagar, New Delhi- 110 015 is the director of JMD Veg Oil Pvt Ltd , JMD Beverages Pvt. Ltd and Supreme Finhold Pvt Ltd. and is the proprietor of M/s Super Traders and M/s Manna Ram Jamna Ram. His personal net worth is Rs.52.90 lacs (Rupees fifty two lacs and ninety thousand only) as on 25.11.2002 duly certified by Mr. O.P.Taneja (Membership No. 84360)of M/s O.P.Taneja & Co.,Chartered Accountants, 101/6, Community Centre , Naraina , New Delhi- 110028 vide his certificate dated 02.12.2002.
2. Mr. Krishan Dhingra, S/o Late Mr. J.R. Dhingra, R/o 5/1-B Ramesh Nagar, New Delhi -110 015 is the director of JMD Oils Pvt Ltd and is the proprietor of M/s Super Business Centre. His personal net worth is Rs.111.83 lacs (Rupees one crore eleven lacs and eighty three thousand only) as on 25.11.2002 duly certified by Mr. O.P.Taneja (Membership No. 84360)of M/s O.P.Taneja & Co., Chartered Accountants, 101/6, Community Centre , Naraina , New Delhi- 110028 vide his certificate dated 02.12.2002.
3. Mr. Naresh Dhingra, S/o Late Mr. J.R. Dhingra , R/o 5/1-B Ramesh Nagar, New Delhi -110015 is the director of Sanjay Protein Pvt. Ltd. and is the proprietor of M/s Sanjay Traders. His personal net worth is Rs. 102.60 lacs (Rupees one crore two lacs and sixty thousand only) as on 25.11.2002 duly certified by Mr. O.P.Taneja (Membership No. 84360)of M/s O.P.Taneja & Co.,Chartered Accountants, 101/6, Community Centre , Naraina , New Delhi- 110028 vide his certificate dated 02.12.2002.
4. Mr. Sanjay Dhingra, S/o Late Mr. J.R. Dhingra, R/o 5/1-B Ramesh Nagar, New Delhi -110 015 is the director of JMD Proteins (P) Ltd and Super Veg Oils Pvt Ltd. His personal net worth is Rs. 24.11 lacs (Rupees twenty four lacs and eleven thousand only) as on 25.11.2002 duly certified by Mr. O.P.Taneja (Membership No. 84360)of M/s O.P.Taneja & Co.,Chartered Accountants, 101/6, Community Centre , Naraina , New Delhi- 110028 vide his certificate dated 02.12.2002.

   
   The Acquirers are engaged in the trading and marketing of edible oils and dairy products under different brand names and their collective annual turnover is approximately Rs. 160 crores.

5. The Acquirers are real brothers.
6. There has not been any formal agreement entered into by the Acquirers.
7. Acquirers have no intentions to dispose of or otherwise encumber any assets of KDIL in the next two years except in the ordinary course of the business of KDIL.

4. BACKGROUND OF THE TARGET COMPANY

No. of shareholders in the public category are 10923.

1. The negotiated price under the Agreement in Regulation 14 (i) Rs. 0.50/-
2. Highest price paid by the Acquirers for acquisition, if any, N.A.

   
   including by way of allotment in a public issue or rights

   or preferential issue during the 26 weeks prior to the public

   announcement,

3. Other parameters including the return on net worth,

Company

Return on net worth as on 30.09.2002 (as per unaudited results) Nil

Book value per share as on 30.09.2002 (as per unaudited results) Rs. 1.32/-

Earning per share as on 30.09.2002 (as per unaudited results) Nil

PE Ratio as on 30.09.2002 (as per unaudited results) Nil

The highest of the prices under Regulation 20(5) comes out to be Rs. 1.32/- only.

7.5.Documents to be enclosed:

• Form of Acceptance duly signed and complete in all respect in accordance with the instructions contained therein, by all shareholders whose names appears on the share certificates.
• Original Share Certificate(s)
• Shares transfer deed(s), complete in all respect and duly signed by all the registered shareholders. In case of joint shareholding, the deed is to be signed in the same order and as per the specimen signature registered with KDIL, duly witnessed at the appropriate place. Find enclosed along with this Letter of Offer a blank share transfer deed to be utilised for this purpose.

• Form of Acceptance duly signed and complete in all respect in accordance with the instructions contained therein.
• Photocopy of the delivery instructions in "Off- market" mode or counterfoil of the delivery instructions in "Off-market" mode, duly acknowledged by the DP in favour of special depository account opened by Skyline Finance Services Private Limited , the Registrar to the Offer, with UTI Bank Limited, Rajouri Garden, New Delhi styled as "Skyline- KDIL Escrow A/c".The DP Id is IN300484 and the beneficiary Id is 10987949.

• Plain paper stating the Name, Address, No. of shares held, No. of shares offered, Distinctive Nos., Folio No.
• Original Share Certificate(s)
• Valid Share Transfer form(s) as received from market. The details of buyer should be left blank, if the details of buyer are filled in, the tender will not be valid under the Offer. All other requirements for valid transfer will be precondition for valid acceptance.
• Original contract note issued by the broker through whom they have acquired their shares.

7.7.Also note that no indemnity is required from unregistered shareholders.

7.8.All necessary requirements for the valid transfer will be a precondition for valid acceptance.

7.9.All the documents mentioned above should be sent only to the Registrar to the Offer and not to be sent to the Acquirers, KDIL or to the Manager to the Offer.

• Memorandum and Articles of Association of Kwality Dairy (India) Limited.
• Copy of Net worth certificates of Chartered Accountant dated 02.12.2002 certifying net worth of Acquirers.
• Certificate of Chartered Accountant certifying the adequacy of financial resources with Acquirers to fulfil the obligations arising pursuant to the offer.
• Annual Reports of KDIL for the Financial Years ended on 31.03.2000, 31.03.2001, 31.03.2002 and unaudited financial results for the quarter ended on 30.09.2002 .
• Letter of The Bank of Baroda, East of Kailash, New Delhi confirming that the amount kept in Escrow Account marked in favour of Manager to offer and Mr. M.K. Doogar has been empowered to operate it.
• Copy of Share purchase Agreement dated 11.12.2002.

• Copy of Public Announcement dated 14.12.2002.
• A copy of letter from Securities and Exchange Board of India in terms of proviso to Regulation 18(2) dated 03.02.2003.

1. The Acquirers accept full responsibility for the information contained in this Letter of Offer.
2. Acquirers would be severally and jointly responsible for ensuring compliance with the Regulations.
3. Manager to the Offer ensures that Mr.Gulshan Dhingra, Mr. Krishan Dhingra, Mr. Naresh Dhingra and Mr. Sanjay Dhingra are duly and legally authorised to sign this Letter of Offer.

Sd/-

Dated: 10.02.2003

Place: New Delhi
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Skyline Financial Services Private Limited

123, Vinoba Puri,

Lajpat Nagar II,

New Delhi-110 024

Dear Sir,

Sub: Open offer by the Acquirers to acquire 31,80,800 fully paid up Equity Shares of Kwality Dairy (India) Limited representing 17.48% of its paid up/ voting share capital at an offer price of Rs. 2.00/- (Rupees two only) per fully paid up equity share payable in cash.

I/We refer to the Letter of Offer dated 10.02.2003 for acquiring the equity shares held by me/us in Kwality Dairy (India) Limited.

I/We, the undersigned have read the Letter of Offer and understood its contents including the terms and conditions as mentioned therein.

For shares held in Physical Form

I/We, hold the following shares and accept the Offer and enclose the original share certificate(s) and duly signed transfer deed(s) in respect of my/our shares:

Total No. of shares offered______ No. of share certificate(s) attached _____ Ledger Folio No.____
 

Sr. No.	Certificate No.	Distinctive Nos.		No. of shares
		From	To
Total Number of equity shares

 

Note: An additional Sheet duly signed and authenticated may be used in case of insufficient space above.

I/We note and understand that the original share certificate(s) and valid share transfer deed will be held in trust for me/us by Skyline Financial Services Private Limited, until the time the Acquirers pay the purchase consideration as mentioned in the Letter of Offer.

I/We confirm that I/We have credited the above stated number of shares to the special depository account styled as "Skyline- KDIL Escrow A/c" for which the DP ID is IN300484 and the Beneficiary Client ID is 10987949 by doing the off market transaction.

I/We note and understand that the shares would lie in the said special depository account until the Acquirers make payment of the purchase consideration as mentioned in the Letter of Offer.

I/We confirm that the equity shares of Kwality Dairy (India) Limited which are being tendered herewith by me/us under this offer, are free from liens, charges and encumbrances of any kind whatsoever.

I/We also note and understand that the Acquirers will pay the purchase consideration only after verification of the documents and signatures.

I/We authorise the Acquirers to accept the shares so offered which they may decide to accept in consultation with the Manager to the Offer and in terms of the Letter of Offer and I/We further authorise the Acquirers to return to me/us, equity share certificate(s) in respect of which the offer is not found valid/not accepted, specifying the reasons thereof and in case of shares held in dematerialised form, to the extent not accepted will be credited back to my beneficiary account with my DP at my/our sole risk.

I/We authorize the Registrar to the Offer, to send by registered post the draft/ cheque, in settlement of the amount to the sole/first holder at the address mentioned below.

The Permanent Account No. (PAN/GIR No.) allotted under the Income Tax Act, 1961 is as under:
 

	1st Shareholder	2nd Shareholder	3rd Shareholder
PAN/GIR No.

Yours faithfully,
 
 
 

	Full name (s) of the holder	Signature
First/Sole Shareholder
Joint Shareholder 2
Joint Shareholder 3

Address _____________________________________________________

Note: In case of joint holdings all must sign. In case of a body corporate, stamp of the Company and its common seal must be affixed and necessary Board/General Meeting resolution and specimen signatures duly attested should also be attached.

Place :

Date :

So as to avoid fraudulent encashment in transit, the shareholder(s) are requested to provide details of bank account of the first/sole shareholder and the consideration cheque / demand draft will be drawn accordingly.
 
 
 

Name of the Bank (specify Branch) ____________ Account Number________________ Savings/Current/Others (please specify)________________________.

 

-----------------------------------Tear along this line --------------------------------------------------------

Received from Mr/Ms/M/s._________________ the Form of Acceptance cum Acknowledgement

-*Physical Shares __________Number of Certificates enclosed ____ Folio No________ .

Certificate Numbers __________Total number of shares enclosed ______________

* Dematerialised Shares : Copy of the Delivery Instruction(s) for _____ No. of Shares

(Tick whichever is applicable)

Note: All future correspondence, if any, should be addressed to Skyline Financial Services Private Limited, 123, Vinoba Puri, Lajpat Nagar II, New Delhi-110 024, Tel:(011) 26847136, Fax: (011) 26918352
 
 

To,

Skyline Financial Services Private Limited

123, Vinoba Puri,

Lajpat Nagar II,

New Delhi-110 024

Dear Sir,

Sub: Open offer by the Acquirers to acquire 31,80,800 fully paid up Equity Shares of Kwality Dairy (India) Limited representing 17.48% of its paid up/ voting share capital at an offer price of Rs. 2.00/- (Rupees two only) per fully paid up equity share payable in cash.

I/We refer to the Letter of Offer dated _______ for acquiring the equity shares held by me/us in Kwality Dairy (India) Limited.

I/We, the undersigned have read the Letter of Offer and understood its contents including the terms and conditions (including the option to withdraw acceptance tendered upto three working days prior to the date of closure of the offer) as mentioned therein.

For shares held in Physical Form

I/We, had tendered the following shares held by me/us in Kwality Dairy (India) Limited, vide the Form of Acceptance cum Acknowledgement dated _________under the offer alongwith all the necessary enclosures:

Total No. of shares offered______ No. of share certificate(s) attached with the application _____ Ledger Folio No.___
 

Sr. No.	Certificate No.	Distinctive Nos.		No. of shares
		From	To
Total Number of equity shares

Note: An additional Sheet duly signed and authenticated may be used in case of insufficient space above.

I/We confirm that I/We had credited the above stated number of shares to the special depository account styled as "Skyline- KDIL Escrow A/c" for which the DP ID is IN300484 and the Beneficiary Client ID is 10987949 by doing the off market transaction.

I/We hereby in terms of the option given to me/us wish to withdraw ________ shares as tendered by me/us under the Offer and hereby request you to return the original share certificate(s) and share transfer deed(s) held by you in trust for me/us for the said number of shares withdrawn by me.

I/We further authorise you to return to me/us original share certificate(s) and share transfer deed(s) by registered post at my/ our risk.

I/We also note and understand that the Acquirers will not pay the purchase consideration for the said number of shares withdrawn by me/ us.

Yours faithfully,
 

	Full name (s) of the holder	Signature
First/Sole Shareholder
Joint Shareholder 2
Joint Shareholder 3

Note: In case of joint holdings all must sign. In case of a body corporate, stamp of the Company and its common seal must be affixed and necessary Board/General Meeting resolution and specimen signatures duly attested should also be attached.

Place :

Date :

-----------------------------------Tear along this line --------------------------------------------------------

Acknowledgement slip

Received from Mr/Ms/M/s._________________ the Form of Withdrawal

-*Physical Shares __________ Folio No________ .

* Dematerialised Shares _____ No. of Shares

(Tick whichever is applicable)

Note: All future correspondence, if any, should be addressed to Skyline Financial Services Private Limited, 123, Vinoba Puri, Lajpat Nagar II, New Delhi-110 024, Tel:(011) 26847136, Fax: (011) 26918352