The boards of Bajaj Hindusthan Ltd. (BHL) and Bajaj Hindusthan Sugar and Industries Ltd. (BHSIL) have approved the merger of BHSIL with BHL.
The boards of both companies have recommended an exchange ratio of one share of BHL for every five shares of BHSIL.
Under the proposed terms of the merger, against the stake of BHL in BHSIL, corresponding number of BHL shares will be directly issued and allotted to a trust to be held for the benefit of BHL as treasury stock.
Kushagra Bajaj, Joint Managing Director, BHL and Chairman, BHSIL, said, “post-merger, BHL will have sugarcane crushing capacity of 1.36 lakh TCD, distillery capacity of 800 kilolitres a day and surplus bagasse based co-generation thermal power capacity of 105 MW. Upon merger, the combined capacities of BHL and BHSIL along with their respective inherent operational strengthens will strengthen BHL's position in India's sugar sector and will enable the company to further enhance overall shareholder value.”
“The amalgamation is a natural consequence and will result in the creation of a single larger entity in place of two smaller entities carrying on similar business under the same management and control, thus resulting in rationalisation of operations, better profitability, enhanced production capacity and a stronger competitive position.”
The proposed merger is expected to contribute to the substantial benefits for BHL in terms of scale, integration, enhanced financial strength and flexibility, thereby enhancing shareholder value.
