By Aditya Raghunath
Investing.com -- On June 7, Investing.com had reported how private equity player Carlyle Group (NASDAQ: CG ) along with a consortium of investors will infuse Rs 4,000 crore into PNB Housing Finance Ltd (NS: PNBH ) via a preferential allotment. The stock had rallied over 100% in six trading sessions.
On June 8, Stakeholders Empowerment Services (SES), an institutional investment advisory firm, in a report, said that the whole process was against minority/retail shareholders of the company and was ultra vires of law.
It also said that this deal would cause a loss of Rs 2,000 crore to Punjab National Bank (NS: PNBK ), one of the country’s largest public sector banks. It said that PNB Housing could have raised the same amount via a rights issue, and PNB could have renounced its rights entitlement to Carlyle at a market-related price.
In an interview with CNBC TV18, JN Gupta, who runs SES said, “85% percent of the shareholders have decided either they want to take preferential or don’t want to take…My argument is if 85% is a party to it, why not make 15% more party to it, and PNB can renounce their right or not, let them do whatever they want. But at least it will be in a transparent manner. The issue is very clear, you have forgotten about the retail shareholders.”
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PNB Housing was trading below 400 for last 2 yrs. Anyone could hav bought the shares from the market. So when Adityapuri / caryle bought stake at the same price.. Share price went up by 100% in a week. Minority shareholders raked in moolah. Not sure - what is there to complain.Like 2
Absolutely correct. The rights are alwyas vested or are created and the retail traders are like sheep . Stupidly they follow some news , ger excited , jack up the shares and ultimately take home banana. We never lewrnt our lessons from Ruchi Soya … we will not lewrn from this either.Like 3