Britannia Industries Limited (Company) has vide its Scheme of Arrangement with its members has proposed for issue of Secured Non-Convertible Fully Paid-Up Debentures by way of bonus to the members as on record date out of the accumulated profits lying to the credit of its Profit & Loss Account.

Reasons/Rationale for the Scheme

The Company is finding that it has cash more than its needs. Investing such cash as treasury investments, in the ultimate analysis will lead to dilution of yields on capital employed in the business particularly in a scenario of falling interest rates. The Company intends to return its retained earnings to its members by restructuring its reserves & surplus. Hence by way of converting the reserves into Debentures, on one hand it would be able to transfer the funds to its members on repayment of debentures and on the other hand, it can use the funds in present for its specified purposes. The scheme does not involve in reduction of issued, subscribed and paid up share capital of the company.

Company has ascertained that even after conversion of reserves& surplus into Debentures, company will have enough cash balance to discharge its liabilities towards creditors on time and in the ordinary course of business.

Terms of bonus Debentures

Company will issue 1 fully paid up 8% secured redeemable debenture of Rs. 30/- each against 1 fully paid up equity share of Re. 1/- each held by the members on Record date on pro rata basis to all the members of the company out of acumulated profits. To effectuate the transaction, the company has proposed Scheme of Arrangement between the Company and its members pursuant to section 230 to Section 232 of the Companies Act, 2013 which is subject to the approval of NCLT, Members, Creditors, RBI and other specified authorities.

Appointed Date

The Appointed Date is considered as 31st March, 2018 and it is only for determining accumulated profits out of which amount will be allocated to issue debentures.

Record date

Record Date will be the date after NCLT approval to be fixed by the Board of Directors.

Process for Issuance of Debentures

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