Piramal Enterprises has agreed to acquire 65.8 lakh shares for cash on preferential basis at a price of Rs 1,200 per share of Shriram City Union Finance.
This represents 9.99 per cent of the post-diluted equity share capital, Shriram City Union Finance said in filing to the BSE.
Shares of Shriram City Union Finance closed at Rs 1,183.05 per unit, up 5.11 per cent on the BSE.
It has been decided to hold an extraordinary general meeting of shareholders on May 30 to seek approval for selling 10 per cent stake, the filing said.
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Shriram City Union Finance is part Shriram Capital where Piramal Enterprises proposes to buy a 20 per cent stake for a total consideration of Rs 2,014 crore.
Piramal, which announced the decision to buy stake in the financial-services company earlier this month, is expected to take stake from a fresh issue of shares by the company.
The company stated that as part of the deal, Piramal Enterprises will get two seats on the board of Shriram Capital.
Ajay Piramal, who sold his pharmaceuticals business to Abbott Laboratories for USD 3.8 billion in 2010, is seeking to expand beyond providing funding for infrastructure and property projects. Financial services was Piramal Enterprises' fastest-growing business last year, a company presentation on its website shows.
The deal follows last year's purchase of 9.9 per cent stake in Shriram Transport Finance, another affiliate of Shriram Group, the statement said.