Kinetic Motor to increase authorized share capital, to issue OCCPS

Kinetic Motor Company Ltd has announced that the Board of Directors of the Company at its meeting held on November 22, 2006 has passed resolutions to increase the Authorised Share Capital of the Company from existing 35 crores to Rs 62 crores and to issue on preferential basis 7,70,000 Optionally Convertible Cumulative Preference Shares (OCCPS) of face value of Rs 65/- each to Jaya Hind Sclaky Ltd (JHS), a Company forming part of Promoter Group, against conversion of existing inter-corporate Deposit given by JHS to the Company, subject to approval of shareholders. Each OCCPS is convertible into one fully paid-up Equity Share of Rs 10 each at a premium of Rs 55 per share within 18 months from date of allotment of OCCPs. The Board has decided to acquire entire Supa undertaking / business consisting of 38 acre land situated at Ahmednagar, Maharashtra, Buildings, dies and moulde, plant & machinery and other related assets on Slump sale basis from Kinetic Engineering Ltd (KEL) for consideration of Rs 53.50 crores to be paid / adjusted / by way of issue of combination of convertible / optionally Convertible / Redeemable Preference Shares to KEL upto Rs 30 Crores and balance by cash and has constituted a Committee of Directors to finalise composition of shares for discharge of the purchase consideration. the acquisition of Supa undertaking / business is a part of the Company's strategy of expansion of business and will benefit the Company in terms of higher revenues from selling & exporting wider range of products including additional scooters, motorcycles and mopeds, better utilization of capacities, improvement in net worth of the Company etc., as large consideration for acquisition of Supa undertaking / business is proposed to be paid in the form of issue of Preference shares.

Source : Equity Bulls

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