Wipro to hive off non-IT biz into unlisted arm, share up 3%

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26 Aug, 2025 12:21

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Moneycontrol Bureau

Software services major Wipro on Thursday said it was demerging three non-IT business divisions--Wipro Consumer Care & Lighting (including Furniture business), Wipro Infrastructure Engineering (Hydraulics & Water businesses), and Medical Diagnostic Product & Services business (through its strategic joint venture)--into a privately-held company to be named Wipro Enterprises Limited.

Wipro shares, which have risen around 4% in the last three sessions, extended gains on Thursday and were up around 3% at Rs 362 in morning trade.

Moneycontrol.com on Wednesday had reported that Wipro was considering a proposal to demerge its consumer business division so that the core business of information technology could get a better valuation.

The date of demerger has been fixed as April 1, 2012, and is expected to be completed by next financial year, subject to regulatory approvals.
 
Under the proposed restructuring scheme, resident Indian shareholders of Wipro Limited have three options:

1. Receive one equity share with face value of Rs.10 in Wipro Enterprises Limited for every five equity shares with face value of Rs.2 each in Wipro that they hold; or

2. Receive one 7% Redeemable Preference Share in Wipro Enterprises Limited, with face value of Rs.50, for every five equity shares of Wipro that they hold; or

3. Exchange the equity shares of Wipro Enterprises Limited and receive as consideration equity shares of Wipro Limited held by the Promoter. The exchange ratio will be 1 equity share in Wipro Limited for every 1.65 equity shares in Wipro Enterprises Limited.

Each Redeemable Preference Share shall have a maturity of 12 months and shall be redeemed at a value of Rs.235.20.

Azim Premji will remain Executive Chairman of the Board of Wipro Limited and will assume the position of Non-Executive Chairman of Wipro Enterprises Limited.

"Creating a technology-focused company will allow us to better serve the needs of our customers, and accelerate investments necessary to capitalize on market growth opportunities" said TK Kurien, CEO, IT Business and Executive Director, Wipro .

Non-resident shareholders (excluding ADR holders) and the ADR holders on the record date would be entitled to receive equity shares of Wipro Enterprises Limited in the aforesaid ratio. The Non-resident shareholders (excluding ADR holders) shall further have the option to exchange the Wipro Enterprises Limited equity shares that they are entitled to and receive equity shares of Wipro Limited held by the Promoter in the aforesaid ratio.

According to the restructuring scheme as currently proposed, the Wipro Enterprises Limited equity shares that the ADR holders would otherwise be entitled to receive shall be compulsorily exchanged for equity shares of Wipro Limited held by the Promoter in the aforesaid ratios.