Butterfly's merger with parent Crompton Greaves fails to gain nod

livemint.com:

Butterfly Gandhimathi Appliances Ltd, on Tuesday rejected a plan to merge the company with its promoter firm, Crompton Greaves Consumer Electricals Ltd. The public disapproval pushed shares of Butterfly Gandhimathi by 7% before they closed at ₹1085.4 apiece on the NSE. Shares of Crompton Greaves too closed marginally lower at ₹282 apiece.

Despite holding a 75% stake in Butterfly Gandhimathi, the promoter --Crompton Greaves, failed to secure public investors’ approval for its proposed merger with the company. This is because 72.61% of non-promoters voted against the merger. According to an exchange filing, 97% of non-institutional public shareholders voted against the merger, even though the merger received full backing from the promoter group firm.

The entire stake in the promoter group firm Crompton Greaves Consumer Electricals is held by public shareholders. Institutional shareholders hold 35.43%, with the largest shareholder being Mirae Asset Tax Saver Fund (8.5%). Other major shareholders include HDFC Mutual Fund (6.10%), UTI Nifty Midcap 150 ET (3.52%), and Nippon Life India Trustee Ltd-A/C Nippon India Tax (3.31%).

Retail shareholders hold the remaining 64.57% of the shares, with resident individuals holding nominal share capital up to ₹2 lakhs holding 11.50% and resident individuals holding nominal share capital in excess of ₹2 lakhs holding 1.58%. “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," said the company. On 25 March