The Hindu Business Line : Shasun's pref allotment gets shareholders' nod

AT an Extraordinary General Meeting on Thursday, shareholders of Shasun Chemicals and Drugs approved a preferential allotment of up to 9.40 lakh equity shares of Rs 10 each at a price of Rs 244 to the US-based GMO Emerging Markets Fund.

Company officials said that GMO's equity stake in the company would be about 10 per cent, and that of the promoters' would slip to approximately 42 per cent from the present level of 46 per cent.

Shasun's shares trade around Rs 321 at present. The preferential allotment agreement was reached last month, and the company stands to raise around Rs 23 crore through the offer (around 32 per cent of the shareholders' funds in March 2003).

Last month, Mr S. Abhaya Kumar, Joint Managing Director, told Business Line ``various FIIs had been discussing (investment) with us''. The GMO offer came by suddenly, he added. Earlier, Shasun was engaged in a discussion with CDC Capital to place equity, but a deal failed to materialise.

Mr Kumar said the company's capital expansion over the next three years would be around Rs 120 crore. A new tablet-making facility, a bulk drug facility and a research centre are on the agenda.

In the context of capital requirement, the equity route would lead to a ``better cash position'' as well as provide new opportunities said Mr Kumar.

Shasun is engaged in the manufacture of bulk drugs such as Ibuprofen and Ranitidine.

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