The amalgamation of Kerala Ayurveda Pharmacy Ltd. (KAPL), one among the major ayurveda manufacturing company in the state, with Katra Healthcare Pvt. Ltd., a Katra group company, has been completed with KAPL board approving the merger on January 24.
The decision of the board has been conveyed to Bombay Stock Exchange and the further business plans would be furnished within March 2006.
"The capital reduction will be in a ratio of 100:55 shares after notifying 21 days prior to issuance and four shares will be allotted to Katra for each share to KAPL. New share certificates will be issued by February 20," told Dr. K. Anilkumar, managing director of KAPL to Pharmabiz.
Meanwhile, Ramesh Vangal, the founder of Katra Healthcare and Tarun Natvarlal Sheth, the advisor of the Bangalore-based company, were appointed as additional directors of KAPL in a board meeting held at the beginning of January 2006. According to the decision, these additional directors will hold office till the next AGM of the company.
According to the agreement between KAPL and Katra Healthcare, the company has to reduce the existing paid up capital and by writing off the accumulated losses amounting to Rs 2.8 crore as on March 31, 2005 of Rs 2.8 crore. The merger is designed to execute through an issue of 40 lakh shares at Rs 10 per share to the shareholders of Katra Healthcare along with 25 lakh attached warrants convertible into one equity share for cash. The merger and capital reduction would be implemented through a court scheme under Sections 391-394 and Section 100 of the Companies Act 1956 and the merger has been legally approved by the High Court of Kerala and Karnataka in the year 2005.
KAPL suffered a setback during the third quarter ended December 2005 and incurred a net loss of Rs 5.61 lakh as against the net profit of Rs 1.43 lakh in the corresponding period of last year. The company's net sales, however, improved slightly to Rs 294 lakh from Rs 285 lakh. For the nine months period, its net loss amounted to Rs 14.61 lakh as against a net profit of Rs 9.09 lakh. Its net sales reached Rs 824 lakh from Rs 844 lakh in the previous period.