Escorts Kubota To Incorporate Subsidiary Company With Rs 700 Cr Authorized Capital

Escorts Kubota Ltd. on Wednesday announced that the Board of Directors at its meeting held today approved the proposal to incorporate a Wholly Owned Subsidiary Company as a Non-Banking Financial Company (NBFC). The purpose of the subsidiary is to finance the Company's Products/Customers.

"the Board of Directors at its meeting held today i.e. September 20, 2023, commenced at 12:30 P.M. and concluded at 13:45 P.M. approved the proposal to incorporate a Wholly Owned Subsidiary Company as a Non-Banking Financial Company, to finance the Company's Products/ Customers at 13:41 P.M," the company said in a filing.

S. No.	Particulars	Information
1	Name of the target entity, details in brief such as size, turnover etc.	Not Applicable
2	Whether the acquisition would fall within related party transaction(s) and whether the promoter/ promoter group/ group companies have any interest in the entity being acquired? If yes, nature of interest and details thereof and whether the same is done at "arm's length"	Not Applicable
3	Industry to which the entity being acquired belongs;	A Non-Banking Finance Company to finance the Company's Products/ Customers.
4	Objects and impact of acquisition (including but not limited to, disclosure of reasons for acquisition of target entity, if its business is outside the main line of business of the listed entity)	The proposed Company will be incorporated and registered as a Non-Banking Financial Company ("NBFC") to finance the Company's Products/ Customers.
5	Brief details of any governmental or regulatory approvals required for the acquisition	The proposed Company will be registered as NBFC thus approval from the Ministry of Corporate Affairs ("MCA"), Reserve Bank of India ("RBI") or any other Statutory Authority, if any will be obtained in due course.
6	Indicative time period for completion of the acquisition	Subject to the approval of MCA, RBI or any other Statutory Authority, if any, the indicative timelines for completion are expected by July 2024.
7	Consideration - whether cash consideration or share swap or any other form and details of the same	Not Applicable
8	Cost of acquisition and/ or the price at which the shares are acquired	The proposed company shall be incorporated with the Authorized Capital of Rs. 700 Crore and the Board has approved the infusion of capital up to Rs. 200 Cr. as and when required as per the business plan of the proposed company.
9	Percentage of shareholding/ control acquired and/ or number of shares acquired	100% being a WOS of the Company.
10	Brief background about the entity acquired in terms of products/ line of business acquired, date of incorporation, history of last 3 years turnover, country in which the acquired entity has presence and any other significant information (in brief)	The proposed company will be incorporated to finance the Company's Products/ Customers in India.

Escorts Kubota is a midcap auto sector company. It has a market valuation of Rs 34,651.70 Crore.

The proposed company shall be incorporated with the Authorized Capital of Rs 700 Crore and the Board has approved the infusion of capital up to Rs 200 Crore as and when required as per the business plan of the proposed company.

The time period for completion of the acquisition is subject to the approval of MCA, RBI or any other Statutory Authority, if any, the indicative timelines for completion are expected by July 2024, the company stated in the filing.

The shares of Escorts Kubota on Wednesday last traded at Rs 3,135.95 apiece, down 1.05% from its previous close. The stock touched the day's highs and lows at Rs 3,177 and low at Rs 3,120.55, respectively.

Stock surges 0.56% in 1 week, and 10.06% in 1 month, respectively. It gained 64.40% in 6 months. It gained 49.77% in 1 year. It gained 117.92% in 2 years, and 153.41% in 3 years, respectively. It gave the highest returns of 331.62% in 5 years.

Its 52-week high is Rs 3,344 apiece and 52-week low is Rs 1,809.95 apiece on the BSE.