Dilmah Ceylon Tea Company is to acquire the tea export business of MJF Teas (Private) Limited for Rs. 442.5 million, the company said in a stock market filing. This will be through a private placement. It further added that the decision to consolidate was taken after taking into consideration the financial statements, past performance, future forecasts as well as the valuation report of MJFT.
Dilmah will issue up to 737,500 new ordinary shares at Rs. 600 per share by way of a private placement with these shares ranking equal to existing ordinary voting shares, subject to the approval of stock exchange, BOI and shareholders at a General Meeting.
The stated capital of the company at present is Rs. 200 million and the public holding of the company currently is 12.81%.
MJFT currently holds 65.38% of the shares of the company and after the private placement the shareholding of ordinary voting shares will go up to 66.6%.
The move is pursuant to a group restructuring initiative to consolidate all value added tea export operations of MJF Group under one entity.
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