 "A worker stacks steel pipes in Ahmedabad")
Stainless steel tubes & pipes manufacturer Prakash Steelage plans to sell its 12.47 per cent additional stake in the newly formed special purpose vehicle (SPV) to its joint venture partner Tubacex S A of Spain.
Currently, Prakash holds 32.47 per cent stake in the SPV - Tubacex Prakash India Pvt Ltd, while Tubacex holds the rest. Prakash announced successful transfer of its seamless stainless steel tubes and pipes vertical to the newly formed SPV.
The board of Prakash Steelage in its meeting held recently approved further dilution of 12.47 per cent stake in the joint venture company to Tubacex to reduce its debts further, the company said in an announcement.
Also, the board approved split of equity share of face value of Rs 10 each into 10 equity shares of face value of Rs 1 each.
Post the said transaction, the company is engaged in the business of stainless steel welded tubes and pipes from its Silvassa factory where the existing manufacturing facilities at Umbergaon is planned to be also shifted. The company continues to carry on its trading activity in stainless steel products.
Of the total consideration of Rs 209.16 crore, the SPV paid Rs 206.01 as bank debt on its seamless division and deal expenses while the remaining Rs 3.15 crore invested in equity share capital in the joint venture company.
The company has reported a smooth and successful completion of the entire transaction as per the terms of the said JV agreement and the bilateral trade agreement followed thereafter.
