Infra.Market may go public through reverse merger with Shalimar Paints

Building materials platform Infra.Market could be heading to the public markets through a potential reverse merger with listed Shalimar Paints, which has approved a Rs 10,440 crore share-swap transaction involving Hella Infra Market, the parent company of Infra.Market. Shalimar Paints has approved a proposal to invest in the equity shares and compulsory convertible preference shares (CCPS) of Hella Infra Market through a swap based on the valuation of both companies. Under the proposed structure, Hella Infra Market may become an unlisted material subsidiary of Shalimar Paints. The company has also said its board is exploring the possibility of “unification” of the two entities at an appropriate stage, subject to applicable laws and the required approvals. While Shalimar has not formally called this a merger, the structure could potentially provide Infra.Market with a route to the public markets through an existing listed company. Under the proposed transaction, Shalimar Paints will issue up to 41.7 crore equity shares at Rs 85 each, amounting to around Rs 3,545 crore. The shares will be allotted to 185 investors through a preferential issue and will be issued for consideration other than cash. Shalimar will also issue up to 81.12 crore CCPS at Rs 85 each, worth around Rs 6,895 crore. These securities will also be issued for consideration other than cash. Together, the two proposed issues are worth around Rs 10,440 crore. Importantly, the Rs 10,440 crore figure is not a cash…