New Delhi: Edible oils maker Ruchi Soya Industries Ltd on Thursday said its board has given nod to sell 51% stake to global private equity firm Devonshire Capital for Rs4,000 crore.
The Ruchi Soya board has also approved filing of a petition with the National Company Law Tribunal (NCLT) for this, as required under the Companies Act, 2013, the firm said in a BSE filing, adding that the board “gave approval for signing of a binding term sheet with Devonshire Capital for investment in Ruchi Soya Industries via acquisition of a majority stake including issue of fresh equity”.
According to the agreement, Ruchi Soya will sell 51% stake in the company to Devonshire Capital, which will also acquire total control in the specific edible brands and distribution business. The deal is valued at Rs4,000 crore and will be paid in tranches, the company said, adding that the amount will be used for clearing debt.
“This strategic investment by Devonshire will enhance the value of our business and provide an effective solution to resolve our outstanding issues with the banks, financial institutions and operational creditors,” said Ruchi Soya CEO Dinesh Shahra.
The company is optimistic on an early completion of this restructuring exercise after all necessary approvals of the lenders and legal formalities, he added.
Ruchi Soya is one of the 28 companies in the Reserve Bank of India’s (RBI’s) second defaulter list for bankruptcy proceedings under the Insolvency and Bankruptcy Code.
On Thursday, shares of Ruchi Soya closed 3.18% higher at Rs29.20 on BSE, while the benchmark Sensex was down 0.08%, or 27.05 points, to 33,560.41.