Ruchi Soya to launch follow-on public offer in 2021, reduce promoters’ stake

NEW DELHI:  Patanjali Ayurved-owned Ruchi Soya will launch a follow-on public offer (FPO) next year and bring down promoters’ shareholding in order to meet the regulatory guidelines.  According to a company official, promoters have to dilute 10 per cent shareholding by June 2021 and 25 per cent in 36 months as per market regulator Sebi. A board resolution has already been passed in this regard. 

“We are going to come with the FPO next year in which we would dilute our shareholding,” Swami Ramdev told news agency PTI, without disclosing the size of the proposed FPO. The Haridwar-based FMCG major had acquired Ruchi Soya in 2019, which is listed on stock exchanges, through an insolvency process for Rs 4,350 crore in 2019. 

The promoters own 99 per cent stake in Ruchi Soya. Ramdev claims that Patanjali Group has run Ruchi Soyaefficiently after the acquisition and it expects higher growth during the current fiscal year. Last week, Ruchi Soya reported a revenue increase of 28 per cent for July-September at Rs 3,990 crore. Net profit was up 54.8 per cent to Rs 126.73 crore.

“We have operated Ruchi Soya well. People were raising doubts on us saying that we have experience only in running FMCG business and not a commodity business,” said Ramdev. The company primarily operates in the business of processing of oilseeds, refining of crude edible oil and manufacturing soya products.

Compliance with Sebi rules
According to the resolution plan approved by National Company Law Tribunal (NCLT), the promoters and the promoter group of Ruchi Soya hold 98.9 per cent stake in the company and the balance 1.1 per cent is public shareholding. However, it has to increase public shareholding so that it can achieve the minimum public shareholding norm in compliance with Sebi rules.