Image Source: Mint
Prudential Sugar Corporation Ltd has announced board approval for a preferential issue of 12.5 million equity shares, marking a significant capital-raising move aimed at funding future expansion and diversification. The proposed issue, subject to shareholder approval at an upcoming Extraordinary General Meeting (EGM), will see shares allotted to select non-promoter investors at a premium, strengthening the company’s balance sheet and supporting its strategic ambitions.
Preferential Issue Details:
The board has approved the offer, issue, and allotment of up to 12,500,000 (1.25 crore) equity shares of face value ₹10 each at a price of ₹35 per share (including a ₹25 premium). The issue will be made on a preferential basis to non-promoter investors for cash consideration, in compliance with SEBI’s ICDR Regulations, 2018.
Purpose and Use of Funds:
The funds raised-potentially aggregating ₹437.5 million-will be used to support future expansion, diversification into new business areas, and to strengthen the company’s financial position. This move aligns with Prudential Sugar’s strategy to capitalize on emerging opportunities in the sugar and allied sectors.
Allotment and Regulatory Compliance:
The shares will be allotted in dematerialized form and will rank pari passu with existing fully paid-up equity shares, including eligibility for dividends. The pricing is in accordance with SEBI’s regulations, and allotment will occur within 15 days of shareholder approval at the EGM, unless regulatory approvals are pending.
Non-Promoter Investors:
The proposed allottees include entities such as Sunil Kumar Bhutra HUF, Choice Strategic Advisors LLP, Gream Traders & Exporters Pvt. Ltd., and Ranital Investments Pvt. Ltd., among others-none of whom are promoters or qualified institutional buyers (QIBs).
Governance and Oversight:
An Allotment Committee, comprising key board members, has been constituted to oversee the process and ensure compliance with all statutory requirements.
Insight
This preferential issue marks a pivotal step for Prudential Sugar Corporation Ltd as it seeks to unlock capital for growth and diversification. By bringing in non-promoter investors at a premium, the company is not only boosting its financial flexibility but also signaling confidence in its long-term prospects. The move comes amid a broader industry trend of capital raising to fund modernization and expansion in the sugar sector.
Source: NSE Corporate Filing, Prudential Sugar EGM Notice, ACE Sphere Announcement
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