CG Power Reaches Top Circuit After Lenders Approve Tube India Offer

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MUMBAI :
CG Power and Industrial Solutions achieved a circuit 5% higher than 22.68 after the company’s lenders approved the takeover bid for the company by Tube Investments of India, led by the Murugappa group.

Tube Investments of India became the successful bidder following a Swiss bidding process launched by CG Power’s lenders, after the company previously said its board of directors approved an investment of 700 crore by Tube Investments for a 56.61% stake.

Accordingly, the Lender has declared the Tube Investments of India (TII) offer as the successful offer, subject to meeting all of the conditions set out in said Letter of Intent. CG Power will organize an extraordinary general meeting of shareholders on September 2, 2020 to obtain its approval for the transfer of shares to Tube Investments and to consider new fundraising by issuing securities on a preferential basis until 100 crore in accordance with applicable laws.

Previously, CG Power had entered into a securities subscription agreement with Tube Investments to sell 64.25 crore of shares to 8.56 each for a total of 550 crore. This will give Tube Investments a 50.62% stake in CG Power. Tube Investments will also receive 17.52 crore warrants, convertible into an equal number of shares within 18 months from the date of grant, for 150 crore. Following the conversion of the warrants, Tube Investments’ stake in CG Power will increase to 56.61%.

On a consolidated basis, CG Power recorded a net loss of 283.53 crore at Q4 March 2020 compared to a net loss of 181.29 crore as of Q4 March 2019. Net sales fell 69% to 616.25 crore in the fourth quarter of March 2020 1988.86 crore in the fourth quarter of March 2019.

CG Power and Industrial Solutions is a pioneering global leader in the management and application of electrical energy. Its offerings include electrical products, systems and services for utilities, power generation and industries.

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