COMPETITIVE · REGULATORY · INDIA
RBI Approves Avenir's Acquisition of Sammaan Capital
Change
The Reserve Bank approved Avenir Investment RSC Ltd's acquisition of a controlling stake in Sammaan Capital Ltd, including an indirect change of control over Sammaan Finserve Ltd.
Why it matters
RBI approval authorizes Avenir Investment RSC Ltd to acquire a controlling stake in Sammaan Capital and effect indirect control of Sammaan Finserve. Avenir will infuse Rs 8,850 crore through a preferential equity issue for an initial 41.23% stake. The stake is slated to increase to 63.36% upon completion of an open offer. RBI also granted a waiver of the public notice period for the company and its subsidiary.
Implications
- · Ownership and board-level decision rights transfer to the Avenir affiliate.
- · An Rs 8,850 crore preferential equity infusion increases Sammaan's equity capital.
- · Shareholder percentages will shift to an initial 41.23% for Avenir and up to 63.36% after the open offer, diluting existing shareholders.
- · Waiver of the public notice period removes that statutory procedural delay for the transaction.
Who is affected
- · Shareholders
- · Corporate boards
- · Creditors
- · Regulators
What to watch
- · Completion of the open offer that raises Avenir's stake to 63.36%
Source
Topics
Business & Markets Mergers & Acquisitions Finance & Banking Banking Regulation Capital Markets