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CESC-Pathik Retail merger swap ratio fixed

Special Correspondent

Retail chain will be expanded to 2,000

KOLKATA: The board of CESC on Tuesday approved the merger of Pathik Retail, the holding company of Spencer's Retail, with itself. Pathik Retail owns 94 per cent of Spencer's Retail.

CESC Vice-Chairman, Sanjiv Goenka, said here at a press meet that as per the swap ratio approved by the board, one equity share of CESC would be given for every 1.98 share of the merging company, involving the issue of 31 million fully paid-up equity shares of Rs. 10 each. "This would have a good effect for CESC shareholders as they are getting into the fast-growing retail business." He said the 175-strong Spencer Retail chain would be expanded to 2,000 by 2009-10 at an investment of Rs. 1,200 crore. This would be financed through a mix of debt and equity which may include raising capital within a year. Subject to necessary approvals, the merger takes effect from April 1, 2007. Post-merger, the promoters' stake in CESC is likely to increase.

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