Sobhagya Capital Options Ltd (Manager to the Buyback) on behalf of Aro Granite Industries Ltd (Target Company) has issued this Public Announcement (PA) to the Equity Shareholders/Beneficial Owners of the equity shares of the Target Company pursuant to the provisions of Regulations 5A and 8(1) read with Regulation 15(c) of the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998 for the time being in force including any statutory modifications and amendments from time to time (Buy-Back Regulations) and contains the disclosure as specified in Schedule II to the Buy-Back Regulations.
The Target Company hereby announces the Buy-back of its fully paid up equity shares of the face value Rs 10/- each (Equity Shares) from the open market using the electronic trading facilities of the Bombay Stock Exchange Ltd (BSE) and the National Stock Exchange of India Ltd (NSE) (Stock Exchanges), in accordance with the provisions of Sections 77A, 77AA & 77B and other applicable provisions, if any, of the Companies Act, 1956 (Act) read with the Article 11A of the Articles of Association of the Company and the Buy-Back Regulations, in the manner and on such terms and conditions as determined by the Board of Directors of the Company (Board) and disclosed in this Announcement, for a minimum of 10,00,000 Equity Shares (Minimum Offer Shares) and a maximum of 12,50,000 Equity Shares (maximum Offer Shares) at a price not exceeding Rs 55/-per Equity Share (Maximum Offer Price) payable in cash, for an aggregate amount not exceeding Rs. 550 lacs (Maximum Offer Size) from the existing owners of Equity Shares (Buy-back) other than those who are Promoters, Promoter Group, Person(s) in Control, Person(s) Acting in Concert (Persons in Control) (that being understood that the Person(s) in Control and Person(s) Acting in Concert will be such persons as have been disclosed under the filings made by the Company under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, as amended (SEBI Takeover Regulations).
The Maximum Offer Size represents 6.04% of the aggregate of the Companys total Paid up Equity Share Capital and Free Reserves as on March 31, 2009.
The actual deployment in Buy-back would depend upon the average price paid for the Equity Shares bought back and the actual number of Equity Shares bought back, subject to the maximum limit of 6.04% of the total Paid up Equity Share Capital and Free Reserves of the Company, in accordance with the resolution passed by the Board on June 08, 2009.
The Company proposes to buy a minimum of 10,00,000 Equity Shares of Rs. 10/-each at a price not exceeding Rs 55/- per share.
The Company shall place buy orders at least once a week so long as the market price is below the Maximum Offer Price and the Buy-back will close in terms with the timetable mentioned herein. However, it is being clarified that the Company shall have the flexibility to close the Buy-back at an earlier date in the event the Minimum Offer Shares have been purchased.
The fact that the Board Resolution provides for the Maximum Offer Price does not indicate that the Company will or is obliged to buy or continue to buy Equity Shares, so long as the market price is below the Maximum Offer Price. Similarly, the fact that this Board Resolution mentions the Maximum Offer Size and Maximum Offer Shares that may be bought at a price per Equity Share not exceeding Rs. 55/- per share does not indicate that the Company will utilize or is obliged to utilize, the entire amount of Rs. 550 lacs (being the Maximum Offer Size) in the Buy-back or that the Company will buy or is obliged to buy all the Maximum Offer Shares.
The Maximum Offer Price has been arrived at after considering certain parameters such as earning trend in the recent past, the future outlook for the Industry/Company and other relevant factors, including but not limited to, post Buy-back equity capital, return on net worth and earnings per share etc.
The average market price of the equity shares of the Company on BSE and NSE for the 26 weeks and two weeks immediately preceding the date of the Board Meeting has been Rs. 33.95 and 33.47 (being 26 weeks average market price for BSE and NSE, respectively) and Rs. 49.60 and 49.10 (being 2 weeks average market price for BSE and NSE, respectively) respectively.
Based on the above factors the Board of Directors has considered it appropriate to make the Buy- back offer at a maximum price of Rs. 55/- per equity share.
The Maximum Buy-back Price of Rs. 55/- is at a premium of 63.15% on its last 26 weeks average price, at a premium of 11.44% on its last 2 weeks average price and a premium of 13.5% and 17.8% over the closing prices on the BSE Rs. 48.45 and NSE Rs. 46.65 respectively prevailing on, June 08, 2009, i.e. on the date of the Board meeting approving the Buy-back.
As required under the Act and the Buy-Back Regulations, the Company shall not purchase Equity Shares which are partly paid-up, Equity Shares with call-in-arrears, locked-in or non-transferable Equity Shares in the Buy-back till the time they become fully-paid, or till the pendency of the lock-in or till the Equity Shares become transferable.
There will be no negotiated deals (whether on or off Stock Exchanges), spot transactions or any other private arrangements in implementation of the Buy-back.
Schedule of activities:
Board Resolution approving Buyback - June 08, 2009
Date of Announcement - June 10, 2009
Date of Opening of Buy-back - June 29, 2009
Acceptance of Shares - Within the relevant payout dates of the Stock Exchanges.
Verification of Equity Shares accepted in physical mode - Within 7 days of the relevant payout dates.
Extinguishment of Shares - Within 7 days of acceptance or verification of Equity Shares as mentioned above.
Last date for Buyback - June 07, 2010 (i.e. 12 months from the date of the Board resolution).
However the Board at its absolute discretion may decide to close the Buyback at an earlier date in the event the Minimum Offer Shares have been purchased under Buyback, even if the Maximum Offer Size has not been reached or the Maximum Offer Shares have not been bought back, by giving appropriate notice of such date and completing all formalities in this regard as per relevant laws and regulations.
There would be a completion of all payment obligations in respect of Buyback prior to the last date of the Buyback.