CG Power and Industrial Solutions Limited (CG) hits an upper circuit of 5 per cent at Rs 22.68 after the lenders of the company had approved to take over the bid of Tube Investments of India (TII) from Murugappa Group.
In the bidding process, TII emerged as a successful bidder, and the company’s board had earlier approved an investment of Rs 700 crore from Tube Investments for a stake of 56.61 per cent company’s lender had declared TII’s offer as a successful offer, subject to all conditions mentioned in the letter of intent.
CG Power’s General Meeting of shareholders is going to be held on 2 September for securing approval of shares transfer to TII and to raise a fund of Rs 100 crore through preferential shares.
Earlier, the company had decided to sell 64.25 crore shares to TII at Rs 8.56 per share, for a total of Rs 550 crore, which would give TII 50.62per cent stake in CG Power. The company would also be allotted 17.52 crore warrants for Rs 150 crore, which would be equal to the same number of shares within a period of 18 months from the date of allotment and then, TII will hold 56.61% stake.
CG Power had reported a net loss of Rs 283.53 crore on a consolidated basis in the Q4, FY20 results compared to a net loss of Rs 181.29 crore in the same quarter in the FY19. Net sales of the company fell by 69 per cent to Rs 616.25 crore in the Q4, FY20 results against Rs 1988.86 crore in the Q4, FY19.