Prime Focus touched 52-week high of Rs 58.95, rising nearly 14 percent intraday on December 29 after Reliance Capital opposed the stake sale by Credit Suisse.
Reliance Capital in its press release said that SEBI is to order a thorough investigation in this matter and immediately prevent/restrain Credit Suisse from selling the Prime Focus shares.
The sale of equity shares of Prime Focus is below the intrinsic value would be illegal, in breach of fiduciary duties, and will be substantially prejudicial to the stakeholders of the Company including its 8 lakh shareholders and lenders (including LIC of India, GIC, New India Assurance, EPFO, Army Group Insurance Fund, MSEB Provident Fund), it added.
Credit Suisse admittedly is in control of 33.12% shares of Prime Focus and the offer price of Rs 44.15 per share is not even one-third of the true valuation of Prime Focus shares of Rs 150, it added.
On December 24, 2020 a Share Purchase Agreement (SPA), was entered into by Credit Suisse (acting through IDBI Trusteeship Services Limited) with the promoters of Prime Focus, to sell 33.12% shares at Rs 44.15 per share.
This transaction will in turn trigger an open offer by the promoters to acquire another 26% stake in the company from public shareholders at the same price of Rs 44.15 apiece.
According to Reliance Capital, the transaction is done in a private and clandestine manner - involving deals between two foreign entities - a colorable device to defeat the provisions of SEBI Takeover Regulations & defraud public shareholders.
At 09:43 hrs Prime Focus was quoting at Rs 57.65, up Rs 5.85, or 11.29 percent and Reliance Capital was quoting at Rs 12.35, down Rs 0.20, or 1.59 percent on the BSE.
