Patanjali Foods promoters to dilute stake to meet SEBI norms

New Delhi: Patanjali Foods on Wednesday said its promoters plan to sell shares to institutional investors in June for dilution of a 6 per cent stake to meet minimum public shareholding norms of 25 per cent.

Patanjali Foods Ltd (PFL), erstwhile Ruchi Soya Industries, was acquired in September 2019 by Baba Ramdev-led Patanjali Group through a corporate insolvency resolution process. In an interview with PTI, Ramdev said: "We are planning to meet the minimum shareholding norms as prescribed by the market regulator SEBI." He further said that the company is targeting to dilute around 6 per cent stake in June through Qualified Institutions Placement (QIP) and Offer for Sale (OFS). "We have already started roadshow from Wednesday and there is a great interest from global investors," Ramdev said.

At present the public shareholding in PFL stands at 19.18 per cent, which needs to be increased to a minimum of 25 per cent. Rule 19A(5) of the Securities Contracts (Regulation) Rules, 1957 mandates a listed entity to have a minimum public shareholding (MPS) of 25 per cent. PFL has a market cap of nearly Rs 38,000 crore. Its share on Wednesday settled at Rs 1,047.85 per scrip on BSE, up 2.56 per cent from the previous close. When asked about the amount which PFL will raise through dilution of stake, its CEO Sanjeev Asthana said:" It will depend on the market condition and interest of investors. On the preferred route for selling shares, he said, "Either it will by QIP or a combination of QIP and OFS."

Earlier in March, stock exchanges NSE and BSE had frozen the shares of promoters of Ramdev-led Patanjali Group firm PFL, which is a major edible oil player. PFL had then informed that leading bourses BSE and NSE had frozen shares of its 21 promoter entities, including Patanjali Ayurved and Acharya Balkrishna, who is the managing director of Patanjali Ayurved and co-founder of Patanjali Yogpeeth Haridwar, for failing to meet minimum public shareholding norms.