Putting an end to a regulatory dispute, FMCG major Gillette India Ltd (GIL) today announced a fresh plan to meet Sebi's minimum public shareholding norms under which its US-based promoter Procter & Gamble and Poddar Group would sell part of their respective holdings.
While Procter & Gamble would sell 0.9 per cent stake, worth about Rs 66 crore at current market value, Poddar Group would also bring down their holding to below 5 per cent through part sale of equity, the company said in a statement.
"Subsequently, the process for termination of the shareholders agreement between the Poddar group and the P&G group shall be initiated, pursuant to which the Poddar Group will have no special rights in Gillette India other than that of a normal public shareholder," it added.
Further, S K Poddar and A Poddar will step down from the Gillette India board and on approval of the resolution passed by Gillette India shareholders in a general meeting or a postal ballot. The remaining shareholding of the Poddar Group shall be considered as public shareholding, the company said.
"SEBI has mentioned that they will not insist on P&G making an open offer as a result of the above mentioned events, in view of the intent behind the transaction, which is to comply with the minimum public shareholding requirements," it added.
SEBI has also imposed several restrictions and provided guidelines to the company to adhere to achieve the minimum public shareholding requirements.
"There shall be no acquisition of shares of Gillette India by Poddar Group for a period of one year from the date of declassification of Poddar group as public shareholder," SEBI said.
Commenting on the development, S K Poddar told reporters on the sidelines a press conference: "Once we complete the process, I will be declassified as promoter and left with little less than 5 per cent or 4.99 per cent in Gillette. I have done it in the interest of the company."
He added that the latest Sebi decision came after several rounds of discussion and it never a unilateral decision.
"We will call for an annual general meeting to inform the shareholders about the changes and all formalities should be over in two to two-and-half months time that is by September or October. There is discussion between me and P&G on a severance package," Poddar said.
Gillette India is jointly promoted by The Procter and Gamble Co and Poddar Group. Promoters hold 88.76 per cent