Coimbatore- Pricol Ltd., an auto component manufacturer based on Coimbatore has filed it’s objection of Minda Corp’s acquisition of 24.5% stakes.
As per Pricol’s statement, “Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we would like to inform that the Company has filed a preliminary objection against the Minda Corporation Limited’s (Minda) application to the Competition Commission of India (“CCI”) for making investment in Equity Shares of Pricol Limited upto 24.5% of total Equity Shares of Pricol, while also reserving right to challenge in detail on merits at the appropriate stage.”
Initially Minda Corp had acquired about $48 million worth of equity shares (15.7%) of Pricol. In a regulatory filing it had also stated that it was as part of their financial investment and not to claim any other special rights other than of a shareholder.
Pricol on the other hand had said that they have no intention in undertaking any other secondary sale of their Promoter’s Share and the company doesn’t seek to raise any equity capital as their financial fundamentals has been strong to meet out their future growth.
From 15.7% Minda Corp wanted to raise its stakes to 24.5% in Pricol and thus had approached the CCI. It is to note that Pricol and Minda Corp are arch rivals in the field of two wheeler instrument cluster business, with Pricol holding a market share of 40- 50% while Minda Corp stands at 15%.
According to the Indian Competition act, any firm exceeds in threshold of its value of assets and turnover needs to get approval from CCI before an acquisition- immaterial of the natire of transaction.
According to the latest filling of FY 2023, the Promoters share of Pricol stands at 36.53%; Public holding 53.24%; MF investments at 4.95%; FII at 3.67% and Other holdings at 1.6%
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