- The shares were sold by the Vistra ITCL (India) Ltd
- CG Power said that the creditors had invoked 67.6 million pledged equity shares in March
- It is facing corporate governance issues in the wake of a financial fraud allegedly perpetrated by its promoter
Private equity firm KKR India on Monday picked up 10 percent stake in CG Power and Industrial Solutions for over Rs 89 crore through open market transactions. KKR India Debt Opportunities Fund II and KKR India Financial Services bought a total number of over 6.26 crore shares or 10.01 percent stake in CG Power. The stakes were bought at an average price of Rs 14.25 apiece, summing up to a total of Rs 89.31 crores. The shares were sold by the Vistra ITCL Ltd (India).
“KKR India Financial Services Ltd and KKR India Debt Opportunities Fund II have, in the exercise of their rights in respect of credit facilities extended to Avantha Holdings Ltd and the subsidiary Salient Financial Solutions Ltd and through the enforcement pledges created by Avantha Holdings Ltd, acquired 50,736,588 and 11,938,021 equity shares of CG Power and Industrial Solutions Ltd through a transaction on the stock exchange,” the PE firm said on Monday.
CG Power said that the creditors had invoked 67.6 million pledged equity shares in March, constituting 10.8% of the company’s share capital, held by one of its promoters, Avantha Holdings. Vistra ITCL on behalf of debenture holders—BOI AXA Credit Risk Fund, KKR India Financial Services, and KKR India Debt Opportunities Fund II—had invoked these shares.
Besides, in March itself, private sector lender Yes Bank had acquired 80 million shares, or 12.8% stake, in CG Power on pledged shares of its promoter.
On 20 August this year, the board of the CG Power and the Industrial Solutions Ltd. said that the company will restate accounts after discovering much “significant accounting irregularities” and governance lapses, sending its shares plunging by the maximum daily limit of 20%.
CG Power is a leading player in the electrical equipment and engineering sector It is facing corporate governance issues in the wake of a financial fraud allegedly perpetrated by its promoter came to light. Thapar was removed from CG Power’s chairmanship on 30th August. The company’s board is considering selling non-core assets and exploring various fundraising avenues to deleverage the company and optimize its operations further.