Shreyas Shipping Delisting Attempt Falls Short, Shareholders Reject Counter Offer

Shreyas Shipping's attempt to delist from the stock market has faced a significant setback. The proposed delisting offer, spearheaded by Transworld Holdings Ltd., the company's promoter entity, failed to garner the necessary 90% of outstanding shares for a successful delisting.

Image Source -www.freightwaves.com

Shreyas Shipping's attempt to delist from the stock market has faced a significant setback. The proposed delisting offer, spearheaded by Transworld Holdings Ltd., the company's promoter entity, failed to garner the necessary 90% of outstanding shares for a successful delisting.

To meet the minimum acceptance conditions for delisting, the promoters, in combination with shares acquired through the delisting process, must equal or exceed 90% of the company's total paid-up equity share capital.

In response to the delisting's initial hurdles, Transworld Holdings initiated a counteroffer to Shreyas Shipping's public shareholders, proposing to purchase their shares at Rs 400 each. This counteroffer came after the reverse book-building process determined a share price of Rs 890 each.

The counteroffer was open from Wednesday, October 11, to Tuesday, October 17, with the intention of repurchasing up to 64.9 lakh equity shares from public shareholders. However, an exchange filing on Tuesday night disclosed that promoters had only successfully repurchased 36.04 lakh shares through 2,724 bids in the reverse book-building process and the counter offer.

Despite these efforts, the promoter and promoter group entities could only amass an 87.86% stake in the company, falling short of the mandatory 90% requirement for a successful delisting.

Also Read: Arindam Bagchi Named India's Permanent Representative To UN In Geneva

An official exchange filing declared the failure of the counteroffer due to the inability of the acquirer's post-counter offer shareholding, combined with other promoter and promoter group members, to exceed 90% of the total issued equity shares.

This setback took a toll on Shreyas Shipping's stock price, which ended 1% lower on Tuesday and saw a cumulative decline of over 10% during the last five trading sessions. In fact, the company's stock has experienced a decline in 11 out of the last 13 trading sessions, reflecting the uncertainty surrounding its delisting endeavor.

Shreyas Shipping's management now faces the challenge of reassessing its strategy and garnering greater shareholder support if it intends to proceed with the delisting in the future.