Ruchi Soya's Follow-On-Public Offer: Floor Price, Other Details
New Delhi: Edible oil firm Ruchi Soya, owned by Yoga teacher Ramdev-led Patanjali Ayurved, has announced the floor price for its follow-on public offer (FPO) to raise up to Rs 4,300 crore. In 2019, Patanjali acquired Ruchi Soya, which is listed on the stock exchanges, through an insolvency process for Rs 4,350 crore. The company is in process of coming out with the FPO issue to meet market regulator SEBI's norm of minimum public shareholding of 25 per cent in a listed entity.
Patanjali promoters currently own a nearly 99 per cent stake in Ruchi Soya. They need to dilute a minimum 9 per cent stake in this round of the FPO.
As per the Securities and Exchange Board of India (SEBI) norms, the company needs to bring down promoters' stake to achieve the minimum public shareholding of 25 per cent. It has around 3 years to pare promoters' stake to 75 per cent.
FPO's Floor Price: The company has decided on a floor price of Rs 615 to Rs 650 per equity share for the issue.
Face Value: The company will offer shares with a face value of Rs 2 each. The minimum bid lot would be 21 and in multiples of 21 equity shares thereafter.
Issuance Date: The bid or the issue will open on March 24 and close on March 28.
As per the draft red herring prospectus (DRHP), Ruchi Soya plans to utilise the entire issue proceeds for furthering the company's business by repayment of certain outstanding loans, meeting its incremental working capital requirements and for other general corporate purposes.
FPO is an additional share sale offer while an IPO or initial public offering is the first sale of shares of a company.