Ruchi Soya Industries Ltd. shares surged after the company signed a pact to sell majority stake to global private equity firm Devonshire Capital.
The edible oil manufacturer will sell 51 percent stake in the company to Devonshire Capital, it said in an exchange notification today. The PE fund will also acquire total control in the specific edible brands and distribution business which will be converted into a special purpose vehicle. The deal is valued at Rs 4,000 crore and will be paid in tranches, the notification added.
The enterprise value of Ruchi Soya is close to Rs 6,700 crore and its total debt stood at Rs 5,923 crore, as of September end, according to the company’s annual report. The pact is subject to regulatory and other necessary approvals, the company said.
In September, Ruchi Soya said two international lenders DBS Bank India and Standard Chartered Bank have filed independent insolvency cases against the company at the Mumbai bench of the National Company Law Tribunal. The company was also part of the second list of stressed assets sent to banks by the Reserve Bank of India, a senior official at a large public sector bank had told BloombergQuint earlier.
Shares of Ruchi Soya rose 18.4 percent on the Bombay Stock Exchange after the announcement.