Arnold Holdings shares jumped 20% to Rs 18.72 on BSE in early trade on Wednesday, Sept. 9, hitting the upper price band, after the company disclosed a proposed stake transaction involving the promoter and another acquirer.
The company plans to acquire 35.55 lakh equity shares of Arnold Holdings, representing a 14.96% stake in the company, from two non-promoter shareholders. The shares will be acquired at Rs 12 apiece.
Promoter to Acquire 14.96% Stake
Harivardhan Enterprises Pvt Ltd has entered into a Share Purchase Agreement with promoter Pawankumar Nathmal Mallawat and Allwin Securities Ltd for the sale of 20.65 lakh shares, equivalent to 8.69% of Arnold Holdings' voting share capital.
Separately, Khattu Hospitality Pvt Ltd has agreed to sell 14.90 lakh shares, representing 6.27% of the voting share capital, to Pawankumar Nathmal Mallawat. Both transactions are priced at Rs 12 per share.
Together, the two transactions involve 35.55 lakh shares, representing 14.96% of the company's voting equity share capital. The sellers are classified as non-promoter shareholders.
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Open Offer For Public Shareholders
The proposed transactions will require the acquirers to make an open offer to Arnold Holdings' public shareholders under the applicable SEBI takeover regulations.
The company said the Share Purchase Agreement does not give the acquirers special rights such as the right to appoint directors, subscribe to further shares or restrict changes in the company's capital structure.
“The Share Purchase Agreement does not confer any special rights on the Acquirers, including any right to appoint directors, right to subscribe to further issue of shares/securities, preemptive rights or rights to restrict any change in the capital structure of the Company. The agreement primarily provides for the sale and purchase of the Sale Shares and contains customary conditions precedent, representations, warranties and covenants in relation to completion of the transaction,” the company stated in the exchange filing.
Arnold Holdings also said the acquisition contemplated under the agreement is not expected to result in any change in the management or control of the company.
No Financial Liability On Company
The obligations under the Share Purchase Agreement are primarily between the sellers and the acquirers. According to Arnold Holdings, the agreement does not impose any financial liability, payment obligation, business restriction, or other material liability on the company.
The company said Pawankumar Nathmal Mallawat is the promoter, while Allwin Securities is related to the promoter. The transaction itself has been stated not to be a related-party transaction.
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