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" 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."
DEFINITIONS
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
2.2.3.The Acquirers have not acquired any share of KDIL after the date of Public Announcement and upto the date of this Letter of Offer. 2.3.2.The prime object of the offer is to acquire control and management of KDIL. 2.3.3.Acquirers have undertaken that they will not dispose of or otherwise encumber any substantial assets of KDIL except in the ordinary course of business in the next two years without taking prior approval of the shareholders. 2.3.4.Option under Regulation 21(3)
KDIL was promoted by Kwality Ice Creams (India) Limited, Late Mr. P.N. Ghai and Mr. Pradeep Wig with the main object to carry on the business of manufacturing, processing and dealing in Dairy Products. The company is presently dealing in ghee, milk powder and other dairy products. 4.2.The total paid up equity share capital of KDIL as on the date of the Public Announcement is Rs.18,20,00,000/- comprising 1,82,00,000 fully paid up equity shares of Rs. 10/- each. Out of this 1,32,00,000 fully paid equity shares are listed on the stock exchanges whereas remaining 50,00,000 fully paid up equity shares are not listed on any of the stock exchanges. The new management will take steps to get these shares listed on the stock exchanges. 4.3.KDIL passed a resolution on 15.12.2000 to issue by way of preferential allotment 5,00,000 fully convertible preference shares at a price of Rs. 10/- each to be converted into fully paid up equity shares within 18 months from the date of issue. The same were converted into equity share on 14.06.2002. These shares were acquired by KICL, promoter of the target company. As a result of the said acquisition/ conversion, the shareholding of KICL increased from 35.93% (pre conversion) to 53.53% (post conversion) and hence, Regulation 11(1) of the Regulations was attracted. Further the collective shareholding of the promoter group increased from 78.60% (pre conversion) to 84.48% (post conversion) and hence, Regulation 11(1) of the Regulations was attracted. In terms of Regulation 3(1)(c) of the Regulations (prior to amendment on 09.09.2002), in order to be eligible for exemption from the applicability of Regulation 11(1) and 11(2) of the Regulations, KICL was required to comply with the provisions of Regulations 3(1)(c) and 3(3) and was also required to file a report under Regulation 3(4) read with 3(5) of the Regulations. However, KICL had not filed any report u/r 3(4) for the said acquisition of 17.60% equity shares of KDIL and hence, the extent of compliance with the aforementioned regulations could not be examined. Further, KICL is one of the parties to the agreement dated 11.12.2002 entered into by the Acquirers prior to this offer. In view of the above, the agreement dated 11.12.2002 can not be acted upon till the required report is filed with SEBI and the compliance is established. 4.4.As more than 50% of the net worth was eroded due to accumulated losses, the company had filed an application to the Board of Industrial and Financial Reconstruction on 23.11.2001 in compliance with the necessary laws. There has been no further correspondence on the matter. 4.5.1,32,00,000 fully paid equity shares representing 72.53% of the paid up/ voting capital of KDIL are listed on BSE, DSE and CSE. 4.6.The company is the license user of the trade mark 'Kream Kountry' which is registered in the name of 'Kwality Ice Creams (India) Limited'. As per the Acquisition Agreement M/s Kwality Ice Creams (India) Limited has agreed to assign/ transfer all its right, title and interest together in the said trade mark in favour of the Target Company. However, the company is entitled to continue to use the said brand name till all the formalities of assigning/ transfer are completed and no royalty for the use of the trade mark will be required to be paid by the company until the completion of such transfer. 4.7.Share capital structure of KDIL:
4.9.The applicable provisions of Chapter II of the Regulations have been complied with by KDIL at stock exchanges. However, there have been some delays in filing the same. The company may avail benefit of the "SEBI Regularization Scheme, 2002" for regularization of the abovementioned delays. However, in case of non compliance penal action may be initiated against the company in future. 4.10.As per the records available with the company, KDIL has been regular in complying with listing requirements except for the non listing of 50,00,000 equity shares and no punitive actions have been taken by any of the Stock Exchanges against KDIL. 4.11.The composition of the Board of Directors of KDIL as on 14.12.2002 is as under:
4.13. The Financial information of KDIL is as under:
No. of shareholders in the public category are 10923. 5.1.2.The annualised trading turnover of the shares of the Target Company on the Stock Exchanges is as under:
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. 5.1.5.The acquirer has not entered into any non � compete agreement. 5.1.6.If the Acquirers acquire shares of KDIL from the date of Public Announcement upto seven working days prior to the closure of the offer i.e. 20.03.2003 at a price higher than the offer price, then the Acquirers shall pay highest price paid by them for such acquisition for all the shares tendered any time during the offer period and accepted under the offer. 5.2.2.The total fund requirements for the acquisition of 31,80,800 equity shares at the offer prize of Rs. 2.00/- is Rs. 63,61,600/- (Rupees sixty three lacs sixty one thousand and six hundred only). In accordance with Regulation 28 of the Regulations, the Acquirers have created an Escrow Account by way of cash deposit in Bank of Baroda, East of Kailash Branch, New Delhi-110 065 of Rs.16,00,000/- (Rupees sixteen lacs only) being more than 25% of the total consideration payable to shareholders under the offer. 5.2.3The Acquirers have authorized D & A, Manager to the Offer to operate and realize the value of the Escrow Account in terms of the Regulations. 5.2.4.The Manager to the Offer has satisfied itself about the Acquirers' ability to implement the offer in accordance with the Regulations. 6.2.Lock in Period of shares held by the promoters of Kwality Dairy (India) Limited in compliance with the SEBI guidelines is as follows :
7.2.Eligible persons to the offer may also download a copy of Form of Acceptance cum Acknowledgement, which is available on SEBI's website at http:/www.sebi.gov. in and can apply for the offer in such downloaded form. 7.3.The Registrar to the offer has opened a special depository account titled - "Skyline- KDIL Escrow A/c" with UTI Bank Limited, Rajouri Garden, New Delhi . The DP Id is IN300484 and the beneficiary Id is 10987949. Shareholders having their beneficiary account with CDSL have to use Inter Depository Delivery Instruction Slip for the purpose of crediting their shares in favour of the special depository account with NSDL. 7.4.Those Shareholders who are holding shares of KDIL in Demat form and wish to tender their shares under the offer will be required to send their Form of Acceptance Cum Acknowledgement along with a photocopy of the delivery instructions in "off-market" mode, duly acknowledged by the Depository Participant (DP) in favour of the Special Depository account, to the Registrar to the offer either by hand delivery /Registered post or through courier on or before the close of the offer i.e. 20.03.2003. 7.5.Documents to be enclosed:
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. 7.11.In the event of non-receipt of Letter of Offer, the shareholders may send application on plain paper stating the Name, Address, No. of shares held, No. of shares offered under the offer, Distinctive Nos., Folio No. along with all documents as mentioned above, so as to reach the Registrar to the Offer on or before the date of closure of the offer i.e.20.03.2003 or in case of beneficial owners (those shareholders who hold shares in dematerialised form) may send the application in writing to the Registrar to the Offer on a plain paper stating the Name, Address, No. of shares held, No. of shares offered under the offer, the name of the DP, DP ID No., beneficiary account number with a 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 so as reach the Registrar to the Offer on or before the closure of the Offer i.e. 20.03.2003. 7.12.Non Resident/ Foreign national shareholders should enclose a copy of the permission received from Reserve Bank of India (RBI) to acquire the equity shares held by them in KDIL.If the shares are held under General Permission of RBI, the Non Resident/ Foreign national shareholders should state that the shares are held under General Permission and also whether they are held on repatriable or non-repatriable basis. Non Resident/Foreign national shareholders should enclose No Objection Certificate/ Tax Clearance Certificate obtained from the Income Tax Authorities under Income Tax Act, 1961, indicating the tax to be deducted by the Acquirers before payment of consideration to such Non Resident/ Foreign national shareholders, otherwise the tax will be deducted at a rate as may be applicable as per the prevailing provisions of the Income Tax Act, 1961 to the category of the shareholders on the consideration payable by the Acquirers. 7.13.The Registrar to the Offer will hold in trust the share certificate(s), shares lying in credit of the special depository account, Form of Acceptance cum Acknowledgement, delivery instruction slip(s) and the transfer deed(s), till the Acquirers complete their offer obligations in terms of the Regulations. 7.14.Applications which are complete in all respect and which reach the Registrar to the Offer on or before the date of closure of the Offer i.e.20.03.2003 would be approved and accepted by the Acquirers. The payment of consideration for the applications so accepted will be made by crossed account payee cheque /demand draft/ pay order. The intimation regarding acceptance of applications and payment of consideration will be dispatched to the shareholders by registered post at the shareholders� sole risk. In case of joint holder(s), the cheques / demand draft will be drawn in the name of the first holder and in case of unregistered owners of shares the consideration will be paid to the person whose name is stated in the contract note. 7.18.The withdrawal option can be exercised by submitting the Form of Withdrawal enclosed with the letter of offer so as to reach Registrar to the Offer on or before the last date for withdrawal of application i.e. 12.03.2003. 7.19.In case of non receipt of withdrawal form for physical shares, the withdrawal option can be exercised by making an application on plain paper stating name, address, folio no., distinctive no., no. of shares tendered in the offer and no. of shares withdrawn and the date of the transaction so as to reach Registrar to the Offer on or before the last date for withdrawal of application i.e.12.03.2003. 7.20.In case of non-receipt of withdrawal form for Dematerialized shares, the withdrawal option can be exercised by making an application on plain paper stating name, address, no. of shares tendered in the offer and no. of shares withdrawn, DP name, DP ID, beneficiary account no. and a photocopy of delivery instruction in "off market" mode or counterfoil of the delivery instruction in "off market mode, duly acknowledged by the DP in favour of the Depository Escrow Account so as to reach Registrar to the Offer on or before the last date for withdrawal of application i.e.12.03.2003. 7.21.In case of withdrawal of application, all the documents forwarded to Registrar to the Offer will be sent back to the shareholder by Registered post at shareholders� sole risk.
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.____
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:
Yours faithfully,
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.
-----------------------------------Tear along this line -------------------------------------------------------- Acknowledgement slip 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 FORM OF WITHDRAWAL 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.___
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,
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 |
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