Acquisition of VMS TMT Limited by Kamdhenu Ltd

On June 17, 2024, Kamdhenu Limited’s Board of Directors of Loan and Investment Committee approved the acquisition of 2,11,000 equity shares of ₹10 each at ₹230 per share, amounting to ₹4,85,30,000. This represents 1.56% of shareholding post-acquisition. This acquisition was through a preferential issue by VMS TMT Limited, a franchisee unit of Kamdhenu Limited.

This acquisition is not considered a related party transaction. None of the promoters or promoter groups have any vested interest in the acquired entity. Therefore, the acquisition is conducted at an “arm’s length” basis.

Objects And Impact Of Acquisition

The entity being acquired operates within the steel industry. The acquisition aims to strategically invest in franchisee units, aligning with the objectives outlined in the Explanatory Statement for the Extraordinary General Meeting held on January 13, 2024. This move is intended to enhance and reshape the company’s franchisee business. The acquisition is expected to be complete by June 30, 2024.

About VMS TMT Limited

VMS TMT Limited, incorporated under the Companies Act 2013 on April 9, 2013, specialises in manufacturing TMT Bars from Billets. It operates as a franchisee unit of Kamdhenu Limited, producing Kamdhenu Brand TMT Bars under a franchise agreement. The company is exclusively based in India. As of the latest financial data, VMS TMT Limited has a paid-up share capital of ₹13,33,71,240. Over the last three financial years, its turnover has grown significantly, amounting to ₹225.04 crore in 2020-21, ₹493.72 crore in 2021-22, and ₹882.01 crore in 2022-23.

About Kamdhenu Ispat Ltd

Kamdhenu Ispat Ltd is India’s leading producer of high-quality Steel Bars. It utilises advanced CRM Belgium technology across its three main segments: Steel, Power, and Paints. The company’s product range includes CID bars, thermo-mechanically treated (TMT) bars, TMT-Gal bars, and stainless steel. Kamdhenu Ltd. is the first company to receive the prestigious ISO 9001:2000 certification. Their manufacturing facility is located in Bhiwadi, Rajasthan. Kamdhenu Paints, a company division, operates a production unit in Chopanki, Rajasthan.

On June 18, 2024, Kamdhenu Ltd’s share price opened at ₹551.60, touching the day’s high of ₹578.85 as of 01:19 PM on the NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.