Last Friday 24 December the Board of FIMBank announced the completion of the acquisition of a 38.5% shareholding in Global Trade Finance Private Limited (GTF). Details of this acquisition were first announced on 26 March 2004 when FIMBank had announced that it had agreed to purchase a 38.5% shareholding in GTF for a cash consideration of USD 4,571,875. GTF is a joint venture company with its head office in Mumbai (India), with other offices in New Delhi, Chennai and Madras.
The new shareholding structure following this acquisition is as follows:
1. 40% – Export-Import Bank of India (EXIM);
2. 38.5% – FIMBank;
3. 12.5% – International Finance Corporation (IFC);
4. 9% – Bank of Maharashtra.
The acquisition was executed by purchasing 12.5% of the shareholding held by IFC and 26% from WestLB AG. The Board of FIMBank also announced that on the 26 August 2004, FIMBank also entered into a Put Option Agreement with GTF, EXIM and IFC.
By virtue of this Put Option Agreement, IFC has the right, by sending a notice of exercise to EXIM and/or FIMBank, at any time and from time to time during the Exercise Period, to sell to EXIM and/or FIMBank, jointly and severally, all or part of IFC’s shareholding in GTF at the Exercise Price.
The Exercise Period means the period beginning 31 March 2007 and ending on either of the following:
(i) the date when all the shares have been disposed of by IFC; or
(ii) the date when all the shares of GTF are listed on the Bombay Stock Exchange or any other exchange acceptable to IFC; or
(iii) 30th September, 2010.
The Exercise Price has been fixed at 1.85 times the Book Value per share of the Company worked out on the pro rata amount of the Shareholders’ Equity as derived from the most recent audited financial statements of GTF for the financial year ended immediately preceding the date of delivery of the notice of exercise, multiplied by the number of shares subject to the Put Option.