Edible oil firm Ruchi Soya, which is owned by Baba Ramdev-led Patanjali Ayurved, will raise up to Rs 4,300 crore in the capital market with its follow-on public offering (FPO) on March 24. In a regulatory filing late Friday, Ruchi Soya said that a committee of the board has approved and adopted the Red Herring Prospectus (RHP). It also approved a bid/issue date of March 24, 2022 and a closing date of March 28, 2022.
The company had received capital markets regulator SEBI’s nod to launch an FPO in August last year. It had filed a draft red herring prospectus (DRHP) in June 2021. The company is going through a public issue in a listed entity to meet SEBI’s minimum 25 per cent public shareholding criterion.
According to DRHP, Ruchi Soya will utilize the proceeds of the entire issue for furtherance of the company’s business by repayment of certain outstanding loans, meeting its incremental working capital requirements and other general corporate objectives. In 2019, Patanjali acquired Ruchi Soya, which is listed on stock exchanges, through an insolvency process for Rs 4,350 crore.
Promoters currently hold around 99 per cent stake. The company needs to sell at least 9 per cent stake in this round of FPO. As per SEBI norms, the promoters’ stake needs to be reduced to achieve a minimum public stake of 25 per cent in the company. It has about three years to bring down the promoters’ stake to 75 per cent.
Ruchi Soya mainly deals in the business of processing of oilseeds, using crude edible oil as cooking oil, manufacturing of soya products and value added products. The company has an integrated value chain in the Palm and Soya segment, with a farm-to-fork business model. It has brands like Mahakosh, Sunrich, Ruchi Gold and Nutrella.
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