Nestlé India Ltd has informed BSE that the Board of Directors of the Company at its meeting held on January 15, 2007, has approved a Scheme formulated under Sections 391 to 394 read with Sections 100 to 102 of the Companies Act, 1956 for enabling utilisation of the Share Premium Account of the Company and part of the General Reserve, for consequent distribution thereof to the shareholders of the Company, subject to applicable tax.
The salient features of the Scheme as approved by the Board of Directors are as under:
1. An amount of Rs 432.3 Million lying in the Share Premium Account of the Company, shall be paid off to the shareholders, after paying applicable taxes.
2. An amount of Rs 430.9 Million that was voluntarily transferred by the Company to its General Reserve Account during the years 1981 to 1997, in excess of the prescribed 10% of the profits of the Company under the provisions of the Companies (Transfer of Profits to Reserves) Rules, 1975 would be reclassified and credited to the Profit and Loss Account for distribution to shareholders as special dividend, after paying applicable taxes.
3. The Scheme as approved by the Board of Directors is conditional upon and subject to approval by the Hon'ble High Court, preceded by approval of the shareholders / creditors.
4. After the Scheme is approved by the Hon'ble High Court and made effective by filing with the authorities, the Company shall fix the Record Date for the purpose of determining the list of shareholders who shall be entitled to receive their proportionate share in the distribution of amounts mentioned in (1) and (2) above, after paying applicable taxes.
HSBC Securities and Capital Markets (India) Pvt Ltd is the financial Advisor and Amarchand & Mangaldas & Suresh A Shroff & Co. are the Legal Advisors to the Company on the Scheme.