BEML's record date for demerger of land assets this week. Key things to know

BEML last month had fixed the record date to determine the eligibility of shareholders for considering 1:1 issue of shares by BEML Land Assets Limited as per Scheme of Arrangement for demerger as approved by the MCA, as Friday, September 9, and the stockwill start trading ex-demerger, a day ahead of the record date i.e., from Thursday, September 8, 2022.

BEML Land Assets is a wholly-owned subsidiary of BEML, incorporated in July 2021, for the demerger of identified surplus and non-core assets as a part of strategic disinvestment of BEML initiated by the government.

BEML is demerging its land assets business from the core business to specify the real value of its core business and fixed assets separately, clearing its way for privatisation.

The company had postponed the board meet to fix the record date from August 18 to August 24, 2022. “We refer to our letter cited above communicating regarding a Board Meeting of BEML Limited scheduled on Thursday , the 18.08.2022, inter-alia, to fix the Record Date for striking the list of eligible shareholders for considering 1:1 issue of shares by BEML Land Assets Limited as per Scheme of Arrangement for demerger approved by Hon'ble MCA, stands postponed to Wednesday, the 24.08.2022, due to administrative reasons," the company had informed in an exchange filing.

Shares of BEML have surged more than 36% in a year's period. The stock has gained over 12% in 2022 (year-to-date or YTD) so far. BEML, a Defence PSU Company, is a leading defence, mining & construction and rail coach manufacturer in India.

The government is likely to invite financial bids for the privatisation of BEML in the December quarter, as per a PTI report. The financial bids are expected in the October-December quarter and the draft share purchase agreement too is expected to be finalised by then.

In January last year, the government invited preliminary bids for selling 26 per cent stake in BEML along with the management control. Multiple Expressions of Interest (EoIs) were received by the government, after which the process of demerger was initiated following comments from investors. Once the demerger is complete, financial bids would be invited.