Vardhman Special Steels Limited has informed the Exchange regarding Notice of Extraordinary General Meeting to be held on Jun 25, 2025
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Vardhman Special Steels has called an Extraordinary General Meeting (EGM) on June 25, 2025, to seek shareholder approval for issuing 1,47,70,100 equity shares (face value ₹10) to Japan's Aichi Steel Corporation (ASC) at ₹260.60 per share, raising approximately ₹384.91 crores on a preferential basis. The capital will fund a greenfield steel plant in Ludhiana (₹134.91 cr), existing plant capex (₹100 cr), and repayment of working capital borrowings (₹150 cr). Post-issue, ASC's stake in the company will rise from 11.33% to 24.90%, making it the second-largest shareholder, while promoter holding will dilute from 60.37% to 51.13%. Two other special resolutions include amending the Articles of Association to incorporate terms of the Share Subscription and Investment Agreement (SSIA) signed on May 29, 2025, and approving special rights for ASC under SEBI LODR Regulation 31B.
This is a strategic investment by a global steel major that brings in long-term capital for expansion and debt reduction, but existing shareholders should note a meaningful equity dilution of roughly 18% expansion of share capital and the entry of a large strategic shareholder with special rights.