MUMBAI: Adar Poonawalla-controlled Rising Sun Holdings will acquire a 60 percent stake in non-banking financial company (NBFC) Magma Fincorp by subscribing to a Rs 3,456-crore preferential issue. After the infusion of capital, Magma and its subsidiaries will be renamed and rebranded Poonawalla Finance.
The company, which has a fledgling NBFC arm called Poonawalla Finance which lends mostly to professionals, said the acquisition will be done through a group company called Rising Sun Holdings. The transaction, subject to shareholders and regulatory nods and through a preferential issue of equity shares of Magma Fincorp worth Rs 3,456 crore, will result in Rising Sun taking over the company with 60 percent stake and an open offer under applicable Sebi guidelines, the statement said.
As part of the transaction, Magma Fincorp proposes to allot 45.80-Cr or 60 percent shares to Rising Sun, and 3.57 crore shares to Sajnay Charmia and Mayank Poddar. The preferential allotment represents 64.68 percent of Magma's enhanced equity share capital post-issue and based on the current shareholding, Rising Sun will hold 60 percent stake and the existing promoter group's stake will come down to 13.3 percent.
The equity infusion will result in the net worth of Magma Fincorp rising to over Rs 6,300 crore. Post-preferential issue, Rising Sun Holdings will become the promoters of Magma Fincorp and its subsidiaries, which all will be renamed as Poonawalla Finance.
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