According to the draft offer document filed with the Securities and Exchange Board of India, the fully convertible debentures will be compulsorily converted into 4 equity shares at a premium of Rs 15 per share within 17 and a half months from the date of allotment. The timing of conversion will be at the option of investors at three months interval within the overall maturity of FCD which is 17 and a half months.
If the option to convert before this period is not exercised, the FCD will be compulsorily converted into equity shares without any further act or application by holders. The FCDs being issued will be unsecured as they will be converted into equity shares within 17 and a half months. The coupon rate on the FCDs is envisaged at 20 per cent. The lead managers to the issue are SBI Capital Markets
Sanghi Industries has chalked out a Rs 733.70 crore plan which includes expansion of its cement capacity and meeting working capital needs. The project was appraised earlier by the State Bank of India in May 1995 for the sanction of the term loan. However, since then the cost of the project and means of finance have undergone a change and the project cost had to be revised.
The project is located at Motiber of Abadasa Taluka in Kutch which is in the North West Gujarat and the project has received a sales tax exemption to the extent of 90 per cent of the fixed capital investment for a period of 14 years from the date of commencement of commercial production. However, the high court of Gujarat has passed an interim order in December 1995, restraining the company from proceeding with the construction work on the jetty.
The project includes development of the port and the company has so far been able to complete the hydrographic survey.