Pritika Auto Industries Gets NCLT Nod For Demerger of Its Automotive Segment

Pritika Auto Industries' shares began trading on the NSE on Wednesday at Rs. 31.40 a share, but they quickly gained 2.93% to trade at Rs. 32.05 in the morning sessions, recording an intraday gain of 2.07%. Following the approval of the plan of arrangement between Pritika Industries Limited (PIL) and Pritika Auto Industries Limited (PAIL) for the demerger of its automotive, tractor, and engineering component business by the National Company Law Tribunal (NCLT), there was a spike in the stock price.

Demerger Details of Pritika Auto Industries

"We are pleased to inform you that the Chandigarh Bench of the Hon'ble National Company Law Tribunal (NCLT) vide its Order dated 4th December, 2023 has granted approval for the Scheme of Arrangement between Pritika Industries Limited (PIL) (Demerged Company) and Pritika Auto Industries Limited (PAIL) (the Resulting Company) and their respective shareholders ("Scheme"), under Sections 230 to 232 of Companies Act, 2013 for Demerger of the Demerged Undertaking ie.

" Automotive/Tractor/ Engineering Components Business Undertaking" of PRITIKA INDUSTRIES LIMITED ("the Demerged Company") into PRITIKA AUTO INDUSTRIES LIMITED ("the Resulting Company')," said the company in a stock exchange filing,

Share Swap Ratio Under The Demerger Process of Pritika Auto Industries

"Upon the Scheme coming into effect, in consideration of the transfer of the Demerged Undertaking by the Demerged Company (PIL) to the Resulting Company (PAIL), in terms of this Scheme, the Resulting Company (PAIL) shall, without any further act or deed, issue and allot to every member of the Demerged Company (PIL) holding fully paid up equity shares in the Demerged Company (PIL) and whose names appear in the Register of Members of the Demerged Company (PIL) on the Demerger Record Date in respect of every 10 (Ten) Equity Shares of the face value of Rs. 10/- (Rupees Ten) each fully paid up held by him / her / it in the Demerged Company (PIL), 63 (Sixty-Three) new Equity shares of the Resulting Company (PAIL) of the face value of Rs.2/- (Rupees Two) each fully paid up.

The listing application for listing of shares of Pritika Auto Industries Limited on allotment of Equity shares to the Shareholders of Pritika Industries Limited will be made in due course of time," said the company in a regulatory filing.

The demerger record date for Pritika Auto Industries has not yet been announced by the automaker. Accordingly, for every 63 shares of PAIL, shareholders of Pritika Auto Industries who held stock on the record date would get 10 equity shares of Pritika Industries (PIL).