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Our Bureau

Hyderabad , Jan. 6

PENNAR Steels Ltd has informed the stock exchanges that an extraordinary general meeting will be held on January 27 to seek the approval of shareholders for the sub-division of existing equity shares in line with the scheme of reconstruction and arrangement to be sanctioned by the Andhra Pradesh High Court.

According to the scheme, with effect from the appointed date of the scheme of reconstruction and arrangement and upon such scheme becoming effective, 50 per cent of the face value of Rs 10 each of 1,66,49,119 fully paid equity shares would stand converted into 1,66,49,119 number of 0.01 per cent cumulative redeemable preference shares of Rs 5 each.

Consequently, the face value of each of the 1,66,49,119 equity shares in the share capital of the company after conversion would be only Rs 5 each.

The preference shares would be redeemable at par in three annual instalments commencing from 2013-14 and ending in 2015-16 at the rate of Rs 1.66, Rs 1.67 and Rs 1.67 respectively per preference share of Rs 5 each.

The company also proposes to alter its Memorandum of Association and has authorised the board of directors to create, offer, issue and allot not exceeding 2.97 crore equity shares of the company of the face value of Rs 5 each aggregating Rs 14.85 crore in one or more tranches to IDBI, ICICI Bank Ltd and IFCI Ltd by conversion of part of the funded interest term loans in line with the scheme of reconstruction and arrangement that may be sanctioned by the High Court.

The company also proposes and has authorised the board to create, offer, issue and allot on a preferential basis not exceeding 3 crore equity shares of the face value of Rs 5 each in the share capital of the company at par, aggregating Rs 15 crore in one or more tranches to the promoters and their associates, including strategic and financial investors against the unsecured loans and contribution brought in or to be brought in by the promoters as a part of the scheme.

Further, the company proposes and authorised the board to create, offer, issue and allot not exceeding 1.6 crore 0.01 per cent cumulative redeemable preference shares of the face value of Rs 5 each aggregating Rs 8 crore in one or more tranches to IDBI, ICICI Bank Ltd and IFCI Ltd by conversion of part of the funded interest term loans in terms of the scheme.

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