Mumbai-based Gammon Infrastructure Projects will be the first company to take the bonus issue route to achieve the 25 per cent public shareholding requirement.
In a filing to the Bombay Stock Exchange (BSE) on Monday, the firm said its board has approved “bonus issue of shares to comply with the minimum public shareholding requirement under Clause 40A of the Listing Agreement, with the promoter/promoter group forgoing their entitlement to the bonus shares”.
According to Clause 40A, a company should maintain public shareholding of at least 25 per cent of the total number of issued shares, which are listed by June 2013.
Subject to shareholder approval, Gammon Infra will issue one bonus share for every 34 shares held by minority investors of the company.
After the bonus issue, promoter shareholding in the company will come down a wee bit from 75.53 per cent to 74.99 per cent. The firm will issue around 5.24 million new shares through a bonus only to its public shareholders.
Right now, Gammon Infra has nearly 40,000 public shareholders, who own about 178 million equity shares (24.47 per cent) of the company.
Gammon Infra shares on Monday ended 2.72 per cent lower at Rs 13.24. The bonus issue announcement came after market hours. So far, the offer for sale mechanism for share-sale was the most proffered route used by promoters to meet the minimum 25 per cent public shareholding requirement.
According to investment bankers, the bonus issue route suits only companies that have to dilute less than one per cent stake to meet the shareholding public requirement.
In August, the Securities and Exchange Board of India had allowed companies to use rights and bonus issue of shares to bring down their promoter holding to 75 per cent. The market regulator also said it would allow any other suggestions for compliance of the public shareholding norm, on a case by case basis.
