Nature of the Event

Promoters of the company, collectively referred to as the "Sellers," have entered into a Share Purchase Agreement with Indo Borax & Chemicals Limited (the "Acquirer") and Zenrock Chemicals Private Limited (ZCPL). The listed entity, Kronox Lab Sciences Limited, is not a party to this agreement.

Key Quantitative Figures

  • The Sellers are Mr. Ketan Vinodchandra Ramani (holding 26.40%), Mr. Pritesh Vinodchandra Ramani (holding 21.40%), and Mr. Jogindersingh Gianchand Jaswal (holding 26.40%) of the company's paid-up equity share capital as of the SPA date.
  • The transaction involves the sale of an aggregate of 2,38,44,000 equity shares, constituting approximately 64.26% of the total paid-up equity share capital of the company.
  • The per share price for the sale under the SPA is ₹103.22 (Indian Rupees One Hundred and Three point Two Two only).
  • An additional disclosure clarifies that the per equity share price, inclusive of consultancy fees payable by the company to the sellers pursuant to transition support arrangements (considered under Regulation 8(7) of the SEBI (SAST) Regulations), is ₹105.87 (Indian Rupees one hundred five point eight seven only) per Equity Share.
  • The Sellers' aggregate holding pre-transaction was 74.21%; their remaining shareholding post-transaction will be 9.95%.

Parties Involved

  • Sellers (Promoters): Mr. Ketan Vinodchandra Ramani, Mr. Pritesh Vinodchandra Ramani, and Mr. Jogindersingh Gianchand Jaswal.
  • Acquirer: Indo Borax & Chemicals Limited.
  • Person Acting in Concert (PAC): Zenrock Chemicals Private Limited.
  • The Acquirer and the PAC are stated to not be related to the company or its promoter/promoter group and did not hold any shares in the company as of the SPA execution date.

Purpose and Rationale

The purpose of the SPA is the sale and transfer of the promoters' shareholding to the Acquirer, resulting in a change of control of the company.

Management, Control, and Capital Structure Impact

  • Upon completion, the Acquirer will hold approximately 64.26% of the paid-up equity share capital and will be classified as the new 'promoter'.
  • ZCPL will be classified as part of the 'promoter group'.
  • The Sellers will cease to be in control of the company and will be re-classified from 'promoter(s)' to the 'public' category under Regulation 31A(10) of the SEBI LODR Regulations.
  • The Acquirer shall appoint 3 (three) nominee directors to the board of directors of the company ("Board"), and the Sellers shall resign from the Board.

Significant Terms and Restrictions

  • Completion is subject to the fulfilment of conditions precedent as set out in the SPA.
  • The Sellers have undertaken non-compete and non-solicit obligations for an identified period.
  • The Sellers' remaining 9.95% shareholding is subject to a lock-in for a period specified in the SPA.
  • After the lock-in period, any proposed transfer of the remaining shares by a Seller is subject to the Acquirer's right of first refusal.
  • For the period between the SPA execution and its completion, the Sellers have undertaken to cause the company to operate in the ordinary course and to not undertake certain material actions without the Acquirer's prior written approval. These restricted actions include entering into material contracts, creating encumbrances, availing indebtedness, altering share capital, declaring dividends, disposing of business, amending charter documents, and incurring capital expenditure above agreed thresholds.
  • Upon consummation, the Sellers will enter into a consultancy agreement with the company.

Financial and Operational Impact

No direct financial impact on the company is quantified in the disclosure, as the transaction is a transfer of shares between shareholders. The operational impact involves a future change in management and control.