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ICICI Bank Limited today informed the stock exchanges that it had acquired 32 million shares or 15.31 per cent of the total diluted capital of Deccan Chronical Holdings Limited (DCHL) to take its total stake to 24.9 per cent in the company.
The bank, which is already in a legal tussle with the media firm to recover its Rs 490-crore loan, also said it had not taken into consideration the fresh allotment of equity shares made by the DCHL management in January to Srei Infrastructure Finance Limited as it was done in breach of a court order.
Prior to the fresh acquisition, ICICI Bank had held 20 million shares of the company totalling 9.59 per cent of the diluted capital before DCHL made fresh issuance of a little over 66 million shares in favour of Srei Infra.
The bank said its percentage of holding in DCHL (24.9 per cent) had been computed by considering the total equity share capital comprising 20,89,72,219 (a little over 200 million) shares at a face value of Rs 2 per share. This was according to the latest filing regarding the shareholding pattern done by DCHL to the stock exchanges for the period ended September 30, 2014.
“The allotment of 6,60,37,735 equity shares by DCHL, disclosed on January 12, 2015, under corporate announcements, has not been taken into consideration as the said allotment is in breach of the interim stay order of the III Senior Civil Judge, City Civil Court, Secunderabad dated March 21, 2014, inter alia, from issue of any further share capital whether at a preferential basis or otherwise; which was further extended vide order of the city civil court dated October 30, 2014 and is binding on DCHL till date,” the bank said in its filing.
Keeping aside the legal validity of the claims regarding the total diluted equity capital of DCHL, ICICI Bank has clearly made the fresh acquisition of shares in a bid to match its shareholding in the company with that of Srei Infra, which had emerged as the single largest shareholder post issuance of fresh equity shares in January. This gives rise to a potentially new legal dispute between ICICI, DCHL and Srei over the total diluted equity capital of the company.
The allotment of 66,037,735 (66 million) shares to Srei at Rs 3.18 apiece in January constitutes 24 per cent of the expanded paid-up equity share capital, comprising 275 million shares. The value of the shares was about Rs 21 crore.
DCHL had last month informed the exchanges that the allotment was made in line with the orders by the Debt Recovery Tribunal (DRT)-1, Kolkata, on Dec 24, 2014, and the decision taken by the board in Sept last year. “The said shares have been issued pursuant to the conversion option exercised by Srei Infrastructure Finance Limited as per Section 81(3) of the Companies Act, 1956, and as directed by the said orders of the DRT. The said shares have been issued in the physical form as requested by the lender,” it said.
The bank, which is already in a legal tussle with the media firm to recover its Rs 490-crore loan, also said it had not taken into consideration the fresh allotment of equity shares made by the DCHL management in January to Srei Infrastructure Finance Limited as it was done in breach of a court order.
Prior to the fresh acquisition, ICICI Bank had held 20 million shares of the company totalling 9.59 per cent of the diluted capital before DCHL made fresh issuance of a little over 66 million shares in favour of Srei Infra.
The bank said its percentage of holding in DCHL (24.9 per cent) had been computed by considering the total equity share capital comprising 20,89,72,219 (a little over 200 million) shares at a face value of Rs 2 per share. This was according to the latest filing regarding the shareholding pattern done by DCHL to the stock exchanges for the period ended September 30, 2014.
“The allotment of 6,60,37,735 equity shares by DCHL, disclosed on January 12, 2015, under corporate announcements, has not been taken into consideration as the said allotment is in breach of the interim stay order of the III Senior Civil Judge, City Civil Court, Secunderabad dated March 21, 2014, inter alia, from issue of any further share capital whether at a preferential basis or otherwise; which was further extended vide order of the city civil court dated October 30, 2014 and is binding on DCHL till date,” the bank said in its filing.
Keeping aside the legal validity of the claims regarding the total diluted equity capital of DCHL, ICICI Bank has clearly made the fresh acquisition of shares in a bid to match its shareholding in the company with that of Srei Infra, which had emerged as the single largest shareholder post issuance of fresh equity shares in January. This gives rise to a potentially new legal dispute between ICICI, DCHL and Srei over the total diluted equity capital of the company.
The allotment of 66,037,735 (66 million) shares to Srei at Rs 3.18 apiece in January constitutes 24 per cent of the expanded paid-up equity share capital, comprising 275 million shares. The value of the shares was about Rs 21 crore.
DCHL had last month informed the exchanges that the allotment was made in line with the orders by the Debt Recovery Tribunal (DRT)-1, Kolkata, on Dec 24, 2014, and the decision taken by the board in Sept last year. “The said shares have been issued pursuant to the conversion option exercised by Srei Infrastructure Finance Limited as per Section 81(3) of the Companies Act, 1956, and as directed by the said orders of the DRT. The said shares have been issued in the physical form as requested by the lender,” it said.
