Description

Open offer by Mr. Niraj Harsukhlal Sanghavi and PACs to acquire up to 58,24,853 equity shares (26% of expanded voting capital) of Avishkar Infra Realty Limited at ₹16.00 per share following preferential allotment triggering SEBI takeover regulations.

Summary

Mr. Niraj Harsukhlal Sanghavi (Acquirer) together with Persons Acting in Concert (PAC) - Ms. Nishra Niraj Sanghvi, Ms. Naysha Niraj Sanghvi, and M/s. Kenilworth Consultancy Services LLP - have launched an open offer to acquire up to 58,24,853 equity shares of Avishkar Infra Realty Limited (formerly Joy Realty Limited). The offer represents 26.00% of the expanded voting share capital at an offer price of ₹16.00 per share payable in cash, including interest at 10% per annum for delayed payment. This open offer was triggered pursuant to Regulation 3(1) of SEBI (SAST) Regulations, 2011 following a preferential issue approved on February 13, 2024, where the Acquirer and PACs acquired 60,000,000 equity shares constituting 26.78% of expanded voting capital.

Key Points

  • Offer Size: Up to 58,24,853 equity shares representing 26.00% of expanded voting share capital
  • Offer Price: ₹16.00 per equity share (face value ₹10.00), payable in cash
  • Interest Payment: 10% per annum for delay in payment
  • Triggering Event: Preferential allotment of 200,000,000 equity shares approved on February 13, 2024
  • Acquirer’s Holding: 60,000,000 equity shares (26.78% of expanded voting capital) through preferential allotment
  • Regulatory Basis: SEBI (SAST) Regulations, 2011 - Regulation 3(1)
  • Target Company: Avishkar Infra Realty Limited (CIN: L65910MH1983PLC031230), formerly Joy Realty Limited
  • No Minimum Acceptance: Offer not conditional on minimum acceptance level per Regulation 19(1)
  • Not a Competing Offer: As per Regulation 20 of SEBI (SAST) Regulations
  • Price Revision Window: Upward revision possible up to 1 working day prior to tendering period commencement (up to December 22, 2025)

Regulatory Changes

This circular implements SEBI (SAST) Regulations, 2011 requirements triggered when an acquirer and PACs cross the 25% threshold through preferential allotment. The mandatory open offer ensures public shareholders receive an exit opportunity at a fair price when control or substantial acquisition occurs.

Compliance Requirements

  • Public Shareholders: Must review the Letter of Offer and decide whether to tender their shares during the offer period
  • Recent Sellers: Those who sold shares should pass the Letter of Offer to purchasers or stockbrokers
  • Acquirer and PACs: Must complete the open offer process per SEBI (SAST) Regulations including payment of offer consideration with interest for delayed compliance
  • Statutory Approvals: Details provided in para 9.4 of the Letter of Offer (as referenced in the document)
  • Manager/Registrar to Offer: Available for shareholder queries and clarifications

Important Dates

  • February 13, 2024: Board approval for preferential issue of 200,000,000 equity shares
  • December 22, 2025: Last date for upward revision of offer price (1 working day prior to tendering period commencement)
  • Tendering Period: To be announced (specific dates to follow)

Impact Assessment

High Impact on Public Shareholders: This mandatory open offer provides an exit opportunity for public shareholders at ₹16.00 per share following the change in control triggered by preferential allotment. The acquirer group now holds 26.78% of expanded capital, and the open offer targets an additional 26% acquisition.

Corporate Control: The transaction represents a significant change in the ownership structure of Avishkar Infra Realty Limited, with the acquirer group seeking to consolidate substantial holding through the preferential route followed by the open offer.

Financial Obligation: The inclusion of 10% annual interest for delayed payment indicates the offer is being made with compensation for non-compliance with original timelines under SEBI regulations.

Market Liquidity: Public shareholders gain liquidity opportunity in what may be a thinly traded stock, with assured exit at the stated price without minimum acceptance conditions.

Impact Justification

Mandatory open offer under SEBI takeover regulations affecting 26% of company's expanded voting capital, triggered by preferential allotment that increased acquirer's stake to 26.78%. Significant corporate action impacting public shareholders with interest payment for delayed compliance.