At the conclusion of its pre-announced board meeting to consider fund raising proposals, Baazar Style Retail informed the exchanges on Tuesday night that it received expression of interest from Cupid Ltd., following which, the board has approved the issuance of one crore, one lakh (1,01,00,000) equity warrants to Cupid.
The warrants will be issued at a price of ₹328.25 per warrant, which is a 2% discount to Baazar Style Retail's closing price on Tuesday. The retail chain will be raising a sum of ₹331.53 crore through this exercise. Warrants will be issued to Cupid on a preferential basis.
Every warrant issued will be convertible into an equivalent number of equity shares and this conversion will be done in one or more tranches within 18 months from the date of allotment of the convertible warrants.
In case Cupid fails to exercise the warrants within this 18-month period, the unexercised warrants will lapse, and 25% of the total consideration paid will be forfeited.
Cupid, which did not hold any prior stake in Baazar Style Retail, will now own 11.92% stake post the conversion of warrants into equity shares.
Investor Aditya Kumar Halwasiya is classified as a promoter for Cupid Ltd. as per the company's shareholding pattern. The company is involved in the manufacturing and supply of sexual health and personal care products, predominantly male and female condoms.
Shares of Cupid are trading 1.8% lower in early trading on Wednesday at ₹395.75, while those of Baazar Style Retail are down 4% to ₹325.45. The latter has risen 30% in the five trading sessions prior to Wednesday, but remains below its IPO price of ₹389.
