The promoter group of Escorts Finance, which includes Escorts chairman Rajan Nanda and family, is increasing its shareholding in the finance company from 49 per cent to around 72-73 per cent.
The shareholding will increase after around Rs 20 crore of convertible loans is converted into equity on preferential basis. The loans were granted to Escorts Finance by several Escorts group investment companies.
The current authorised capital of the company is Rs 40 crore, but the paid up share capital stands at Rs 20.25 crore. If the Rs 20 crore worth of loans is converted into equity, the paid up capital would exceed the authorised share capital. Hence, the company will also need to alter the capital clause of the memorandum of articles (MOA).
The board of the company will meet on April 3, 2003 to consider proposals for changing the capital clause and for conversion of loans into equity shares, said Partha Sarkar, chief executive of Escorts Finance.
