Home / Companies / Pantaloon deal gets nod of Peter England board

New Delhi: Aditya Birla Group firm Peter England Fashions and Retail Ltd’s board on Sunday approved the demerger of Pantaloon format business and fixed the share swap ratio at 1:5—for every five shares of Pantaloon, shareholders will get one Peter England share.

These developments mark a step closer towards Aditya Birla Group’s proposed acquisition of majority stake in Kishore Biyani-led group’s flagship Pantaloon format apparel retail business unit.

“This is further to the in-principle approval given by the board of directors of ABNL on 30 April 2012. The board of directors of PEFRL also approved the share entitlement ratio in relation to the demerger.

Accordingly, the equity shareholders of Pantaloon Retail (India) Ltd will receive one fully-paid up equity share of Rs10 each in PEFRL for five fully-paid up shares (including DVR equity shares) of Rs2 each held in PRIL.

Under the transaction, PRIL will also transfer all undertakings, business, activities and operations pertaining to the Pantaloons Format business to Peter England. Besides, a debt of Rs1,600 crore will also be transferred to PEFRL. The date of transfer has been fixed at 1 July 2012.

Peter England will issue equity shares to PRIL shareholders as per the board approved share entitlement ratio and post-demerger, the holding of ABNL through its subsidiary PEFRL will be 50.09%.

As part of the scheme, ABNL and/or its affiliates intend to make a voluntary open offer to other shareholders of PEFRL.

The transaction is expected to be completed within six months, subject to the requisite statutory and regulatory approvals, including those from the stock exchanges under the listing agreement, shareholders, creditors, Competition Commission of India and the high court.

The share entitlement ratio has been arrived at based on the recommendations of Deloitte Touche Tohmatsu India and Grant Thornton India LLP.

Amarchand & Mangaldas & Suresh A Shroff & Co is the legal advisor to the transaction.

Aditya Birla Nuvo is a $4.5 billion conglomerate and over the years it has ventured into sectors like financial services (life lnsurance, asset management, NBFC, private equity, broking, wealth management and general insurance advisory), telecom, fashion and lifestyle and IT-ITeS.

It is part of the Aditya Birla Group, a $40 billion Indian multinational, which operates in 36 countries across the globe with over 133,000 employees.

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