Kinetic Motor to issue FCDs to Citicorp Finance (India) Ltd

Kinetic Motor Company Ltd has announced that the Board of Directors of the Company at its meeting held on August 16, 2006, has passed resolution for issue of 6,50,000 Fully Convertible Debentures (FCDs) of face value of Rs 65 each to Citicorp Finance (India) Ltd (CFIL). Each FCD shall be compulsorily convertible into one Fully paid-up Equity share @ Rs 65 each (Rs 10 face value + Rs 55 premium) on 365th day from the date of allotment or earlier in the manner set out in the Debenture Subscription agreement. The Issue price of Rs 65/- is higher than the price calculated as per formula specified in Chapter XIII of SEBI (Disclosure & Investor Protection), Guidelines, 2000.

Further the Company has clarify that, these 650000 FCDs from part of 2150000 FCDs proposed to be issued by the Company´s Board of Directors to CFIL as per Resolution passed in the Board Meeting held on June 21, 2006. Out of said 2150000 FCDs, CFIL had earlier applied for 1500000 FCDs and the Company made allotment of 1500000 FCDs to CFIL on August 03, 2006 in accordance with the Special Resolution passed in the Extraordinary General Meeting of the Company held on July 19, 2006. Further the Company has informed that, it is necessary to the Board of Directors of the Company to pass Resolution for issue of the balance 650000 FCD to CFIL in the aforesaid Board Meeting in accordance with SEBI Guidelines for Preferential Issues.

The proceeds of the issue of FCDs will be utilized for the purpose of meeting Company´s capital expenditure requirement for launching of new Scooter Models, expansion of Two-Wheeler business and meeting long term working capital requirements of the Company. CFIL is neither a Promoter nor a person acting in concert with Promoter of the Company.

Source : Equity Bulls

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