Patanjali Foods’ promoters plan to offload up to 9% stake through OFS

The promoters of Patanjali Foods Patanjali Ayurved plan to dispose of up to 9 percent stake (32.58 million shares) through an Offer to Sell (OFS) on Thursday. The size of the underlying issue is capped at 7 percent, or 25.34 million shares, with an option to hold to oversubscribe.

The minimum price of OFS has been set at Rs 1,000 per share, at a discount of 18.4 per cent till last closing. Shares of Patanjali Foods closed at ₹1,228 per share on BSE on Wednesday, up 1.3 percent from the previous day’s close.

The base issuance has a size of Rs 2,534 crore. In the event of an oversubscription, the promoters will sell shares worth up to Rs 3,258 crore. OFS will help the company comply with the requirement of a minimum of 25 percent public shareholding (MPS). Currently, the shareholding of the promoter in the company is 80.82 percent.

In March, the exchanges froze the promoter’s contribution to the company after it failed to meet the general contribution requirement of 25 percent within the specified time period.

In 2019, Patanjali Ayurved acquired Ruchi Soya under corporate bankruptcy settlement process and changed the name of the company to Patanjali Foods. After the CIRP process, the promoter’s stake in the company increased to 99 percent.

In March 2022, the Ramdev-led Yoga company issued 66.2 million new shares at a price of 650 rupees per share via a follow-up public offer (FPO) to increase the public offering. The Rs 4,300 crore raised through FPO was used by the company to pay off its debts.