Tile manufacturer Nitco has announced a sale of real estate assets, expansion of share capital, along with a preferential allotment to Authum Investment and a clutch of investors on October 22.
The shareholder capital has been increased from Rs 230 crore to Rs 500 crore, with the tile maker converting its debt into equity shares as part of the business restructuring. An Extra Ordinary General Meeting is scheduled on November 15 to seek necessary approval of board members.
Investor Authum Investment is being allotted 11.25 crore preferential shares, subject to shareholder approval, post which its stake in Nitco will rise to 44.60% in the expanded share capital.
Nitco had last week announced the settlement of debt worth over Rs 63.30 crore it owed to creditor Authum Investment. Authum had acquired around 97% of the debt of Nitco from JM Financial's ARC entity in April this year, and the allotment of shares to Authum is pursuant to the conversion of the debt payable by Nitco.
"25% of the total consideration will be paid at the time of issuance of the warrants and the remaining 75% of the total consideration shall be paid upon the exercise/conversion of each
warrant within a period of 18 months of allotment of warrants," Nitco informed through a stock exchange filing.
Shares of the tile maker are higher by 262% so far this year, having seen a very sharp run up in the one last month.
Real estate player Macrotech Developer is also securing a minor stake in the company through the allotment.
Authum Investment had recently struck a deal with Prataap Snacks for a controlling stake for Rs 846.60 crore, triggering an open offer.
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