Nature of the Disclosure

Regulatory filing pursuant to SEBI LODR Regulation 30, notifying the stock exchanges of a Postal Ballot Notice sent to shareholders to seek approval for a major slump sale transaction.

Key Quantitative Figures & Transaction Details

  • Transaction Type: Slump sale (as defined under Section 77 of the Income Tax Act, 2025) of the entire Friction Business Undertaking.
  • Buyer: Rane (Madras) Limited (CIN: L65993TN2004PLC052856).
  • Consideration: A lumpsum cash consideration of ₹370.00 Crores (Rupees Three Hundred Seventy Crores only).
  • Business Description: The Friction Business Undertaking comprises the development, manufacturing, marketing, and sale (including export) of fibre-based friction materials. This includes brake linings, brake blocks, brake pads, roll linings, clutch facings, clutch buttons, brake discs, woven roll linings, and friction sheets for automotive, rail, and industrial applications.
  • Assets Included: The sale encompasses all assets, contracts, licenses, employees, and books and records pertaining to the business. This specifically includes two manufacturing plants:
  • Paithan Plant: D-2/1, MIDC Industrial area, Paithan, Dist. Chhatrapati Sambhaji Nagar (Aurangabad) - 431107, Maharashtra.
  • Bhandara Plant: C-10/1, Bhandara Indl. Area, Gadegaon Dist., Bhandara - 441904, Maharashtra.

Dates of Action

  • Board Approval Date: Tuesday, 30th June, 2026.
  • Postal Ballot Notice Date: 30th June, 2026.
  • Cut-off Date (for shareholder eligibility): Tuesday, 30th June, 2026.
  • Remote E-Voting Period: Commences on Friday, 10th July, 2026, at 9:00 A.M. (IST) and ends on Saturday, 8th August, 2026, at 5:00 P.M. (IST).
  • Last Date for Receipt of Physical Ballot: 5:00 P.M. on Saturday, 8th August, 2026.
  • Result Declaration Date: Tuesday, 11th August, 2026, at 4:00 P.M.
  • Deemed Passing Date of Resolution: Saturday, 8th August, 2026.

Parties Involved

  • Counterparty/Buyer: Rane (Madras) Limited.
  • Regulators: BSE Limited, National Stock Exchange of India Limited, SEBI, Ministry of Corporate Affairs (MCA).
  • Scrutinizer: CS Manish Baldeva, Proprietor of M/s. M Baldeva Associates, Company Secretaries, Mumbai (FCS No.: 6180/CP No.: 11062).
  • E-Voting Service Provider: National Securities Depository Limited (NSDL).
  • Registrar and Transfer Agent (RTA): MUFG Intime India Pvt. Ltd (formerly Link Intime India Pvt. Ltd.).
  • Company Officials: Arvind Purohit, Company Secretary & Compliance Officer (Membership No.: A33624).

Purpose & Rationale (as stated)

The stated rationale for the sale is to:

  • Unlock embedded value not fully reflected in the company's market capitalization.
  • Streamline the company's portfolio by reducing complexity.
  • Enable management to focus attention and resources on core long-term strategic segments.
  • Avoid a significant upcoming capital expenditure cycle required for the Friction Business.
  • Strengthen the company's balance sheet.
  • Make the transaction EPS-accretive and result in a more predictable earnings profile.
  • Reduce exposure to a capital-intensive segment with intensifying competition.

Utilization of Proceeds (as stated)

The proceeds, net of transaction costs and tax expenses, are stated to be deployed to:

  • Fund investments in line with the long-term strategy of enhancing shareholder value.
  • Return a portion to shareholders by way of a special dividend.

Regulatory References & Requirements for Approval

  • SEBI LODR: Regulation 30 (Disclosure), Regulation 37A (Requirement for shareholder approval for sale of undertaking), Regulation 44 (E-voting).
  • Companies Act, 2013: Sections 108 (Voting through electronic means), 110 (Postal Ballot), 180(1)(a) (Restriction on powers of Board - sale of undertaking).
  • Companies (Management and Administration) Rules, 2014: Rules 20, 21, 22.
  • Other: Secretarial Standard on General Meetings (SS-2) issued by ICSI; SEBI Circular No. SEBI/HO/CFD/CMD/CIR/P/2020/242 dated 9th December 2020 (on e-voting).

Capital Structure Impact

Not explicitly quantified in the disclosure. The transaction is an asset sale, not an equity issuance, so it does not directly cause dilution. The impact on the balance sheet (cash inflow, asset reduction) is acknowledged.

Financial Impact

  • The transaction will result in a cash inflow of ₹370.00 Crores, subject to adjustments per the Business Transfer Agreement.
  • The net proceeds after transaction costs and tax expenses will be available for use.
  • The transaction is expected to be EPS-accretive.

Voting Procedure Details

  • Shareholders as of the cut-off date (30th June 2026) can vote via remote e-voting on the NSDL platform or by returning a physical postal ballot form.
  • Detailed, multi-step instructions for both individual demat holders and other shareholders are provided for accessing the NSDL e-voting system.
  • If a shareholder votes both electronically and physically, the electronic vote will prevail.
  • The scrutinizer will consolidate all votes and submit a report.

Governance & Interests

  • The Board of Directors recommends the resolution for shareholder approval.
  • It is stated that none of the Promoters, Directors, Key Managerial Personnel, or their relatives are concerned or interested, financially or otherwise, in the resolution.

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