Public shareholders of Butterfly Gandhimathi vote against merger with Crompton Greaves Consumer Electricals
Further to the voting results on the merger of Crompton Greaves Consumer Electricals Ltd (Crompton) and Butterfly Gandhimathi Appliances Ltd (Butterfly), both the entities will continue to operate as separate individual listed entities.
Both Crompton and Butterfly would continue to optimize various revenue and cost synergies by leveraging the distinctive strengths of each company within the kitchen appliances segment.
While the merger will not proceed, there are currently no plans to reinitiate it and thereby Crompton and Butterfly will continue to operate independently, reinforcing their strong market positions and strategies, Crompton Greaves Consumer Electricals said.
The strategy in kitchen appliances segment will encompass both the ‘Crompton’ and ‘Butterfly’ brands, with the expectation of delivering significant growth over the next few years. This initiative offers shareholders of both companies an opportunity to participate in the long-term growth and value creation.
Chennai-based Butterfly Gandhimathi Appliances’ public shareholders rejected the proposal of merging the company with Crompton Greaves Consumer Electricals.
“The Scheme was, inter alia, subject to approval of (i) majority in number representing three-fourth in value of the equity shareholders (including public shareholders) of Butterfly; and (ii) majority of public shareholders of Butterfly”, the companies said.
“While the approval to the Scheme from majority in number representing three-fourth in value of the equity shareholders (including public shareholders) of Butterfly was obtained at the meeting, approval of majority of the public shareholders of the Butterfly was not received in favour of the Scheme at the said meeting of the shareholders,” they said.
Accordingly, as mentioned in the provisions of SEBI Master Circular dated June 20, the Scheme will not be acted upon, due to non-receipt of the requisite approval from public shareholders of the Butterfly, they said.
Butterfly Gandhimati stock is down 7 per cent at Rs 1,089 on BSE.