India
Securities to buy back shares in delisting thrust
Business
Standard - October 1, 2001
India Securities
Ltd (ISL), a non-banking finance company of the Essar Group,
has decided to buy back shares at face value as against
the weighted average market price of Rs 3.75 per share
and get delisted from all the regional stock exchanges
except the Bombay Stock Exchange and National Stock Exchanges
in a phased manner.
At the end of this exercise, which is
expected to be completed by January 2002, the promoters'
shareholding will go up from 62 per cent to 72 per cent.
The
company, which has a paid-up capital of Rs 26 crore, has
recently kicked-off the first phase of the buyback-cum-delisting
exercise for shareholders from Karnataka. It intends
to similarly buyback shares and delist from the New Delhi
and Chennai stock exchanges. The buy back is expected
to cost the promoters of the group, the Ruias, about
Rs 1.66 crore.
A senior company official said, "The
move behind the buyback and delisting is to save on costs
like listing fees. Moreover, as majority of our shareholders
are from Maharashtra. So, it makes sense to continue
to be listed on BSE and NSE only. For shareholders from
other regions, there is always the option of selling
/ buying the company's shares from either the BSE or
NSE terminals of stock brokers in their areas."
Though
the NBFC sector is currently plagued by high levels of
delinquent assets, India Securities, which went public
in 1992, intends to consolidate its existing portfolio
of leasing and hire purchase businesses by making concerted
efforts towards recoveries, he said.
India Securities
has repaid about 97 per cent of its public deposits of
Rs 45 crore, including debentures, and intends to pay
off the balance Rs 70 lakh as and when the deposits mature.
CORPORATE