New Delhi: Welspun Enterprises Ltd (WEL) is looking to divest its entire 15.49% stake in Welspun Energy.
“The board of directors of the company, subject to the approval of the members of the company, has approved sale of its entire investment of 60,493,342 equity shares representing 15.49 per cent in the paid up equity share capital of Welspun Energy,” WEL said in a filing to the Bombay Stock Exchange.
Post sale of its renewable business, WEL’s 15.49% minority stake in Welspun Energy does not contribute to the consolidated results of the company, the filing said. In order to unlock value for the company, the board authorised the monetisation of this stake, subject to shareholders’ approval, it added.
As against its investment of Rs91.1 crore, the stake is proposed to be sold to Welshop Trading Pvt. Ltd, for a consideration of approximately Rs290 crore plus contingent consideration, thereby implying more than 3x returns to the company on its investment.
In addition to buying out WEL’s stake, Welshop Trading Pvt. Ltd, part of Welspun Group, has agreed to buy out the stake of other shareholders in Welspun Energy at equivalent consideration. The services of both PwC and EY were engaged for this transaction. Khaitan & Co was the joint legal advisor.