Power engineering solutions firm Bilpower Ltd has invested Rs 4.08 crore to buy securities convertible into 4.54 per cent stake in broking firm Destimoney Securities Pvt Ltd, a subsidiary of Destimoney Enterprises (formerly Dawnay Day AV Financial Services) that is controlled by private equity firm New Silk Route. The deal values Destimoney Securities at Rs 90 crore ($20 million).
Bilpower acquired 4.08 million Compulsory Convertible Debentures (CCDs) of Destimoney Securities for Rs 4.08 crore, following a deal struck on March 31, 2011. After conversion of the said CCDs into equity shares of Rs 10 each at par, Bilpower will hold 4.54 per cent stake in Destimoney Securities, it said on Tuesday.
This marks an interesting diversification for Bilpower that is primarily into manufacturing transformer cores and lamination and stamping of rotating machines. It is one of the largest players in third party manufacturing of transformer cores and lamination in India. Given the quantum of the stake, this appears more of a treasury operation for the company that had revenues of around Rs 500 crore during 2009-10.
Bilpower had recently announced it plans to raise up to Rs 125 crore through an overseas equity issue, besides around Rs 73 crore under a rights issue.
This comes as a back-to-back transaction for Destimoney Securities that has reportedly raised close to Rs 21 crore by selling 26 per cent stake to Raghuvinder Kataria, a UK-based serial entrepreneur of Indian origin. Last year too, Destimoney had raised money from Dhanlaxmi Bank by selling around 15 per cent stake for Rs 13 crore.
Three years ago, New Silk Route acquired the joint venture firm, floated by UK-based Dawnay Day and former DSP Merrill Lynch honcho Alok Vajpeyi. Since then, it has been renamed and expanding operations. The company has also roped in former Reliance Money chief Sudip Bandyopadhyay as its president. Destimoney has a strategic partnership with Artha Money and sometime back, it has acquired 49 per cent stake in PNB Housing Finance.
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