Intimation under Regulation 30 of SEBI (LODR), Regulations, 2015 -Scheme of Arrangement.
Awaiting price reaction for this filing.
India Radiators Ltd (IRL) has approved a Scheme of Amalgamation with its holding company Mercantile Ventures Ltd (MVL), under which IRL will merge into MVL and be dissolved without winding up. MVL currently holds 38.74% of IRL's equity and 95.58% of voting rights, making this effectively a parent absorbing its subsidiary. Shareholders of IRL will receive 10 equity shares of MVL (face value Rs 10) for every 36 equity shares of IRL, with no cash consideration involved. The swap ratio was determined by two registered valuers with fairness opinions from merchant bankers. The scheme now needs NCLT, SEBI, BSE, shareholder and creditor approvals. IRL is a small, near-zero-net-worth company (total assets ~Rs 18.3 crore, turnover just Rs 4.74 lakh) while MVL is much larger (total assets ~Rs 441 crore, turnover ~Rs 53 crore).
For IRL shareholders, this is effectively a reverse merger into a larger listed entity — they will end up holding shares of MVL instead of IRL, with the swap ratio translating to roughly 0.28 MVL shares per IRL share. The scheme needs multiple regulatory approvals before becoming effective, and the share price of IRL could move on NCLT progress updates.