Shriram Capital Private Limited has announced a formal disclosure regarding the encumbrance of shares in Shriram Finance Limited. This follows the execution of a shareholders’ agreement involving MUFG Bank Ltd and other entities. The arrangement imposes specific transfer restrictions on 33,57,28,920 shares, representing approximately 14.27% of the total share capital. These restrictions are set to remain in place for a three-year period, aimed at governing long-term shareholdings and strategic alignment among the stakeholders.
Details of Share Encumbrance
The disclosure confirms that Shriram Capital Private Limited, along with other promoter entities including the Shriram Ownership Trust, Shriwell Trust, Sanlam Life Insurance Limited, and Shriram Value Services Limited, have entered into a binding agreement. Effective April 8, 2026, these entities have placed contractual restrictions on their holdings in Shriram Finance Limited in favor of MUFG Bank Ltd.
Impact and Scope of the Agreement
The total number of shares impacted by this arrangement is 33,57,28,920, which accounts for 14.27% of the total share capital. The key terms of this agreement include:
- A three-year lock-in period commencing from April 8, 2026, during which these shares cannot be transferred except under specific permitted conditions.
- Post-lock-in, the shares cannot be transferred to any ‘Restricted Person’ under the agreement.
- Any future sale of these shares after the lock-in period will be subject to a right of first offer granted to MUFG Bank Ltd.
Strategic Conditions
The arrangement includes a specific provision stating that these transfer restrictions will cease to be applicable if the total shareholding of MUFG Bank Ltd and its affiliates drops below 10% of the share capital of Shriram Finance Limited on a fully diluted basis. This measure ensures that the restrictions remain tied to the strategic partnership status between the involved parties.
Source: BSE
