The freeze will remain in effect until Patanjali Foods achieves the stipulated public shareholding, the company said in a statement
Indian stock exchanges put a freeze on the shares held by Patanjali Foods’ promoter group entities for lack of minimum stipulated public float. Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) have frozen 29.26 crore shares held by promoters as public shareholders held only 19.18 per cent stake in the company. As per SEBI norms, listed companies should have public shareholding of at least 25 per cent.
The freeze will remain in effect until Patanjali Foods achieves the stipulated public shareholding, the company said in a statement. Earlier known as Ruchi Soya, Patanjali Foods was acquired by Baba Ramdev backed Patanjali in December 2019. Upon completion of the National Company Law Tribunal’s (NCLT’s) resolution plan in 2019, Patanjali Foods had only 1.10 per cent public shareholding.
Under such cases, the company has three years to bring its up public float to 25 per cent, as per SEBI norms. Upon failure to do this, the company’s promoter shares can be frozen by the exchanges.
Following the takeover by Patanjali group, the company had offered a further public offering (FPO) in March 2022. This brought the public float to 19.18 per cent, but now it has failed to cross the 25 per cent mark within the stipulated three-year period.
The company’s statement added, “While management of the company was discussing various means and methods for increasing its public shareholding, in the meantime, the company received an e-mail from the stock exchanges freezing the shareholding of the promoters and promoter group."
During Wednesday’s trade, shares of Patanjali Foods closed 1.3 per cent higher at Rs 964.40 on the NSE.