Kay Power and Paper Limited is proposing to transfer its immovable property (land) located at Borgaon, Satara, measuring approximately 28000 Sq.mtr, to its wholly owned subsidiary, Kay Pulp and Paper Mills Private Limited. The transfer will be at book value, justifying it as an internal restructuring for business efficiency. The proposed transaction is valued at an estimated ₹28 crore, aligning with accounting standards and regulatory requirements.
Strategic Asset Transfer Proposed
Kay Power and Paper Limited has announced its intention to transfer a significant immovable property, specifically land located at Borgaon, Satara. The land parcel spans approximately 28,000 Sq.mtr and is adjacent to the company’s existing kraft paper division. This strategic move is aimed at streamlining operations and consolidating specific business functions under a dedicated entity within the group, thereby enhancing operational focus and efficiency.
Transaction Details and Justification
The proposed transfer will be made to the company’s wholly owned subsidiary, M/s Kay Pulp and Paper Mills Private Limited. The transaction is planned at book value, with the estimated value of the land being approximately ₹28 crore. This approach ensures that no gain or loss is recognized on the transfer, maintaining transparency in financial disclosures. The company highlights this as an internal restructuring exercise to foster business efficiency and align with accounting standards, including Ind AS 110. The Board believes this move is crucial for the company’s growth and operational strategy.
Shareholder Approval Required
In accordance with Section 180(1)(a) of the Companies Act, 2013, the disposal of the company’s undertaking, or substantially the whole of it, requires shareholder approval through a special resolution. Consequently, the company will seek approval from its members for this transfer at the upcoming Annual General Meeting.
Source: BSE
