Key Details

Symbol (NSE): RACE

Corporate Action: Composite Scheme of Arrangement involving Demerger

Record Date: Not Specified

Nature of Scheme: Composite Scheme of Arrangement under Sections 230-232 of Companies Act, 2013 involving demerger of two business divisions to separate resulting companies.

Entities Involved:

  • Demerged Company: Race Eco Chain Limited (RACE)
  • Resultant Company No. 1: Geoeco Green Energy Limited (GEOECO) - to receive Demerged Undertaking No. 1 (Biomass Division)
  • Resultant Company No. 2: Race Gateway Limited (GATEWAY) - to receive Demerged Undertaking No. 2 (Restore Bag Division)

Share Entitlement Ratio: Not Specified

Implied Capital Structure Impact: Not Specified

Post-Allotment Listing Plan: Geoeco Green Energy Limited and Race Gateway Limited must complete listing of securities and commence trading within sixty days of receipt of the NCLT order, simultaneously on all stock exchanges where Race Eco Chain equity shares are listed.

Regulatory and Approval Status:

  • Received observation letters with "no adverse observations" from BSE Limited and National Stock Exchange of India Limited dated September 21, 2026
  • SEBI provided comments on draft scheme dated July 30, 2026
  • Scheme remains subject to NCLT approval
  • Scheme remains subject to shareholder approval
  • Scheme remains subject to creditor approval
  • Validity of observation letters: Six months from September 21, 2026

Effective Date: Not Specified

Financial Rationale: Not Specified

Impact on Shareholders: Not Specified

SEBI Mandated Disclosure Requirements

The observation letters require Race Eco Chain to provide extensive disclosures including:

  • Compliance with Regulation 11 of SEBI (LODR) Regulations, 2015
  • Disclosure of all ongoing adjudication, recovery proceedings, prosecution initiated against company, promoters and directors
  • Details of unlisted companies in abridged prospectus format as per Part E of Schedule VI of ICDR Regulations, 2018
  • Financials not older than 6 months for valuation report
  • Detailed explanatory statement including:
  • Small explanation of scheme
  • Need, rationale, synergies, impact on shareholders, cost-benefit analysis
  • Valuation report details, merchant banker fairness opinion, share-swap ratio methodology
  • Latest financials (not older than 6 months) of all entities
  • Pre and post scheme shareholding patterns
  • Capital build-up for last 3 years
  • Revenue, PAT, EBITDA for last 3 years
  • Asset and liability transfer values and post-demerger balance sheets
  • Potential benefits and risks assessment
  • Financial implications on promoters and public shareholders
  • Enforcement actions against entities involved
  • Impact on reserves with quantitative details

Listing Conditions for Resulting Companies

  • Submission of Information Memorandum with public issue disclosure requirements
  • Newspaper advertisement with reference to Information Memorandum
  • Continuous disclosure of material information
  • Scheme provisions requiring shares to remain frozen until listing/trading permission
  • No change in shareholding pattern between record date and listing
  • SEBI relaxation under Rule 19(2)(b) of SCRR required
  • Compliance with SEBI Circular No. SEBI/HO/CFD/POD-2/P/CIR/2023/93 dated June 20, 2023

Regulatory Compliance Requirements

  • Scheme must be submitted to NCLT within six months (by March 21, 2027)
  • Observations must be incorporated in NCLT petition
  • No changes to draft scheme without SEBI written consent
  • No-Objection letter must be disclosed on website within 24 hours
  • Compliance status report must be filed through NEAPS system