Investors include SBI Mutual Fund, PremjiInvest, Amundi, IDFC, L&T Mutual Fund and others
Emami Group promoters have divested 10% of their stake for a consideration of Rs 1,600 crore in the flagship entity Emami Ltd to a clutch of fund houses and private equity investors.
The investors include SBI Mutual Fund, PremjiInvest, Amundi, IDFC, L&T Mutual Fund and others who participated in a transaction executed on the stock exchange on Monday, Emami executives said.
The stake sale would help the promoters in reducing the debt, which had gone up following the group's diversification into sectors like cement and solar energy.
"The stake sale will ease the liquidity position of the promoter group and reduce the debt. We are committed to maintaining our significant majority stake in the company and do not anticipate any further dilution of stake in the foreseeable future," promoter director Mohan Goenka of Emami said.
Pursuant to the stake sale, the promoter holding in Emami will stand at 62.74%.
While the main fast-moving consumer goods (FMCG) business has negligible debt in its books on account of being largely cash-based, the group has run up a debt of over Rs 2,000 crore in its cement business.
For the FMCG business, it has healthy debt protection metrics. The debt undertaken in fiscal 2016 to acquire Kesh King is expected to be completely repaid in fiscal 2019 through internal cash accruals.
According to the bulk deal data available with the BSE, SBI Mutual Fund, PI Opportunities Fund I-LT and Pioneer Investment Fund bought a total of over 3.72 crore shares in the FMCG firm.
Individually, SBI Mutual Fund bought shares for Rs 722.78 crore, PI Opportunities and Pioneer Investment purchased stake worth for Rs 199.97 crore and Rs 399.98 crore, respectively, with the average price being Rs 355 per share. However, in separate transactions, seven entities including a promoter of Emami Ltd, Amitabh Goenka, sold a total of over 2.3 crore shares for over Rs 844 crore in bulk deals on Monday.
Among the sellers, promoter Goenka sold 40 lakh shares worth Rs 142 crore amounting to 0.88% stake in the firm. According to the latest shareholding data available with BSE, Goenka held 1.67% stake in the company.
Shares of Emami ended at Rs 355.05 apiece on Monday on BSE, down 1.61% over the previous close.
PAIN RELIEF
- Investors include SBI Mutual Fund, PremjiInvest, Amundi, IDFC, L&T Mutual Fund and others
- Pursuant to the Rs 1,600 crore stake sale, the promoter holding in Emami will stand at 62.74%
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
 "FMCG")
)
Pursuant to the stake sale, the promoter holding in Emami will stand at 62.74%.
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}