Global financial major Deutsche Bank is set to pick up stake in Bangalore-based BPL. On Friday, the company's board approved a proposal to make preferential allotment of 24,25,500 equity shares and/ or convertible securities to Deutsche Bank AG (DB) and/ or their nominees and affiliates in terms of applicable Securities and Exchange Board of India (Sebi) guidelines.
The deal is expected to be completed after getting an approval from the company’s extraordinary general meeting.
The BPL board has also approved a qualified institutional placement (QIP) and authorised its chairman & managing director to decide the size and timing of the issue.
The funds will be used as long-term working capital requirement of the company’s healthcare management solutions business and for other general corporate purposes.
BPL Chairman & Managing Director Ajit G Nambiar said that Deutsche Bank has been involved in the company’s restructuring process and the equity investment was a vote of confidence in BPL and its promoters. “This speaks highly of how we are perceived as a brand and also of the direction that we have set ourselves going ahead. We welcome Deutsche Bank aboard. We shall announce our plans shortly.”
This investment from the Deutsche Group will be a much-needed helpline for the cash-strapped BPL, which is going through a painful restructuring process after having run up a debt of Rs 1,400 crore and dwindling market share in the consumer appliances business. The 4-year-old joint venture with Sanyo for colour television is also set to be wound up.
The BPL healthcare management solutions division has been in existence for over three decades and manufactures a range of medical equipment.
