Reliance Infrastructure on Monday said it would begin to acquire shares of Pipavav Defence and Offshore Engineering Company from public investors on December 2.
The mandatory open offer, as part of Sebi’s takeover regulations, will end on December 15, the company said in a stock exchange filing.
The Reliance ADAG company, along with wholly owned subsidiary Reliance Defence Systems, will acquire 26% from public investors at R66 per share. Of the total, Reliance Infra will acquire 13 crore shares or 18% from the promoters of Pipavav Defence.
“…all requisite approvals including the approval of the Competition Commission of India (CCI) and the Gujarat Maritime Board (GMB) have been received for the acquisition together with management control of Pipavav Defence and Offshore Engineering Company (Pipavav Defence),” Reliance Infra said in an exchange filing.
Reliance Infra will also acquire additional shares from the promoters of Pipavav Defence at the price of Rs 63 per share, as is required to ensure that Reliance’s shareholding is not less than 25.10% of the target company after taking into account the acquisitions made under the open offer.
Market regulator Sebi in May 2015 had asked Reliance Infrastructure to launch the open offer within 12 working days of getting regulatory approvals.
Pipavav Defence is mainly into manufacturing of commercial ships and repair of oil rigs. Reliance Defence Systems, part of Reliance Infrastructure, is yet to start commercial operations.
JM Financial Institutional Securities is the manager to the open offer.
In March, Reliance Defence said it would purchase nearly 18% stake in Pipavav Defence from promoter group led by Nikhil Gandhi at Rs 63 per share, amounting to Rs 819 crore, and subsequently make an open offer for an additional 26% at R66 apiece, aggregating Rs 1,263.3 crore.
Shares of Reliance Infrastructure advanced 5.84% or R23 to end at Rs 417.05.