Ruchi Soya, which was acquired by Patanjali Ayurved through the insolvency court, is aiming to open subscription to its FPO for investors before the Independence Day on August 15, sources said. The company had filed its draft red herring prospectus for the FPO in June.
The edibles oils-to-biscuits company is planning to raise Rs 4,300 crore through sale of shares to bring down the holding of its promoter Patanjali Ayurved as mandated by Sebi’s minimum public shareholding norm.
As per Sebi rules, Patanjali has to reduce its stake to 75 per cent or below by December 2022. Ruchi Soya said that its promoter will dilute its holding by a minimum of 9 per cent in the follow-on public offer. As per the latest shareholding pattern, Patanjali owned close to 99 per cent stake in the company.
Ruchi Soya, known for its Nutrela soya chunks, aims to use half of the FPO proceeds for repaying the existing debt of the company. It will also use Rs 593.4 crore for working capital and the remainder for general corporate purposes.
Shares of Ruchi Soya, which relisted on the bourses in January 2020 after the conclusion of the insolvency proceedings, surged as much as 8,000 per cent in six months driven by the low free-float and heavy investor interest. Those gains have since pared down to 6,276 per cent.
Existing shareholders of the company are concerned that the FPO may be issued at a considerable discount, which could lead to selling pressure in the secondary market–listed shares of the company.
Baba Ramdev, promoter of Ruchi Soya, recently told ETMarkets.com that the pricing of the issue will be in the interest of all shareholders of the company. “Big investors will make money and small investors will also not see any losses,” Ramdev told ETMarkets.com.
Ramdev also laid out his plans for Ruchi Soya. The Yoga guru-turned-entrepreneur said that Ruchi Soya will become an 80 per cent FMCG company and 20 per cent edible oils company with the aim of becoming a market leader in each of the categories it is present in.
