Sharp India

Sharp India has come up with Open Offer.

I hold shares of Sharp India. Kindly can you give your views as to whether to hold or sell and around what price ?

Just saw that the thread has been revived after 2 years. I was just looking up SHARP on screener. What happened to it after Mar 2015 quarter? The revenue tumbled from 43 Cr (Mar’15) to 18 Cr (Jun’15) to 1.5 Cr (Sep’15). Seems to have recovered somewhat now to Rs 14.6 Cr (Jun’16). But I am curious to know what happened during Mar’15-Mar’16?

Disclosure: Not invested. Curious since I am tracking a similar company BPL which is appearing to stage a comeback, just as SHARP had appeared to in 2014.

as you might be knowing sharp corp (the parent) has been in deep financial trouble for the last decade and earlier this year it was bought by foxconn for its cutting edge technology. therefore, the company has come out with Open offer for public’s 25% shareholding.what i am trying to understand is that if it would lead to delisting?

I think it is for delisting only, why else they should acquire balance shares held by public?

Views of forum members are requested as to what price we can expect and rationale.

normally delisting offer comes out as delisting offer… open offer is normally different.

Sharp India already holds max. limit of 75% shares. Since the open offer
is for the balance 25% shares held by public, can it be assumed that they​ ​will be delisting ? In which case, should it not be a Delisting Offer and​ ​whether SEBI allows Open Offer and delisting subsequently ?

not sure man. i think today they have put an update on open offer, where obviously after open offer the “expected” promoter holding becomes 100%. now my question is assuming they get just 1% or just enough shares in open offer so that the shareholding increases beyond 75%, then what are the options that foxconn would have to pare the excess promoter holding and within what time frame.

Thanks for sharing your views. Just got this…

Firstly open offer is mandatory once there is change in ownership/management control as per SEBI so this open offer is in compliance to this rule.
Secondly the open offer is at 53/- whereas the open market price is over 60/- so in my opinion they will not get any shares tendered, so delisting will not happen as for delisting 90% is the threshold.
One needs to keep a hawks eye to see what Foxconn 's plans are for this Indian subsidiary of theirs. Can be interesting.
Disc: Not invested

ofcourse the tendering may not happen at 53 but even if one share is tendered their holding goes up by 75%. Then what are the options that Foxconn has? This is what i want to understand. 1. probably delisting. 2. selling shares in open market/Qip to reduce their holding to 75%… and any other options?

All said and done, as far as i know, Foxconn has grand plans for sharp and especially their foray in india, therefore, not too worried if delisting does not happen but i am definitely interested in knowing the process.

A view I have read elsewhere is that -

If they get more than 90% in open offer they may come with a delisting offer later, but if they are not getting that, either they may offload something to bring down it again to 75% if they want to keep listed, or come out with a delisting offer at a revised price to buy the remaining.

They will either have to bring it down to 75% OR after 12 months they have to come out with voluntary delisting offer again.
The below is from their present offer letter:

14. At present, the promoter and promoter group of the Target Company holds 75% of
the Voting Share Capital of the Target Company. Post completion of the Offer, the
Target Company, the members of the promoter and promoter group of the Target Company, the Acquirer and the PAC undertake to take all steps necessary to
comply with the minimum public shareholding requirement in accordance with Clause
40A of the listing agreement read with Rule 19A of the SCRR.

15. In case the shareholding of the members of the promoter and promoter group of
the Target Company, the Acquirer and the PAC exceeds the maximum permissible
non-public shareholding pursuant to the Offer, none of the promoter and promoter
group of the Target Company, the Acquirer or the PAC shall be eligible to make a
voluntary delisting offer, unless a period of twelve months has elapsed from the
date of the completion of the Offer Period.

thanks for this. makes sense

Thanks for this info. My buy average is below 40 and will hold on and hope to gain. Thanks once again to all of you for your inputs.

Today it hit Upper Circuit of 20%!!!

yes on back of news. this is looking a great stock to accumulate in the range of 57-60…ofcourse tomorrow’ls move could take the base a little higher.

Dear Sir, what are the possibilities ? Are they planning to delist ? What price shareholders should expect ?

“Sharp India Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on September 28, 2016, inter alia, to constitute the Committee of Independent Directors of the Company to provide the reasoned recommendations on the mandatory open offer made by Sharp Corporation, Japan and the persons acting in concert with them to the public shareholders for acquisition of their shares”

This meeting of the independent directors is just to verify that the open offer already made is in conformity to the existing rules and regulations, thats all. Just procedural stuff.

Disc: not invested

true, but as of now, the base has moved higher thanks to today’ts break of multiple resistance. ofcourse i am talking technicals for this one. fundamentally it all depends on what foxconn’s intentions are.