Shares of Prabhat Dairy plunged 10.47% intraday to Rs 71 after the board approved a voluntary delisting of the company's shares.
Reacting to the announcement, the stock price of Prabhat Dairy formed a gap down chart pattern to trade 10.47% lower at Rs 71, its intraday low on BSE. The stock trades higher than 20 and 50-day moving averages but lower than 200-day moving averages. Overall the value of the stock price has fallen over 1% in a week's period.
The trading volume on the counter amounts to 0.25 lakh shares and 3.6 lakh shares changing hands on the BSE and NSE so far.
"The proposed Delisting Resolution has been placed before the shareholders as a result of the receipt of a letter dated September 4, 2019 from certain members of the promoter and promoter group namely, Mr. Sarangdhar Ramchandra Nirmal, Mr. Vivek Sarangdhar Nirmal, Madhyam Farming Solutions Private Limited and Nirmal Family Trust," the filing added who had, "expressed their intention to acquire 4,87,40,547 fully paid-up equity shares, representing 49.90% of the paid-up equity share capital of the company that is presently held by the public shareholders".
As per the filing submitted on September 15, the company voluntarily has delisted the equity shares from the stock exchanges namely, BSE Limited and National Stock Exchange of India Limited and withdrew "permitted to trade" status of the equity shares on the Metropolitan Stock Exchange of India Limited.
Additionally, the company has appointed Saffron Capital Advisors Private Limited as the merchant banker after taking note of the Delisting Proposal and has fixed floor price per equity share at Rs 63.77, in accordance with regulations of the Delisting Regulations of SEBI.
"The Acquirers will proceed, at their discretion, to make an offer to the public shareholders of the Company and purchase the equity shares at the exit price in accordance with the Delisting Regulations", the filing further read.
As of 1400 IST, the share price of Prabhat Dairy was trading lower by 2.96% at Rs 76.95 on BSE.
By Rupa Burman Roy