Gufic Biosciences Clarifies Nature of Share Subscription to Saraswat Co-operative Bank

Gufic Biosciences Clarifies Nature of Share Subscription to Saraswat Co-operative Bank​

Gufic Biosciences Limited has issued a clarification regarding its recent subscription of shares in Saraswat Co-operative Bank Limited. The company detailed that this share transaction is mandatory and related to specific share-linkage requirements applicable to its status as a borrower member of the bank.

The clarification emphasizes that this share subscription should not be viewed as an acquisition of ownership stake or an investment in Saraswat Bank.

Saraswat Bank operates as a Multi-State Co-operative Bank under the Multi-State Co-operative Societies Act, 2002. The bank mandates that its borrower members maintain a share capital linkage. According to the RBI Master Circular on Prudential Norms on Capital Adequacy for Primary (Urban) Co-operative Banks, a share linkage of up to 2.5% of secured borrowings is permitted.

Gufic Biosciences Limited, which is an existing borrower member of Saraswat Bank, currently holds credit facilities aggregating approximately ₹ 230 crore. The company stated that the subscription of additional shares is being undertaken due to an opportunity extended by Saraswat Bank to eligible borrower members to increase their share capital linkage, staying within the permissible limits set by the applicable framework.

The company confirmed that this transaction is executed in the ordinary course of the existing lender-borrower relationship between Gufic and Saraswat Bank.

Crucially, Gufic highlighted that the subscription will not change the management, control, or governance rights of Saraswat Bank. Furthermore, the company noted that, according to Section 31 of the Multi-State Co-operative Societies Act, 2002, Saraswat Bank adheres to the "one member, one vote" principle. Consequently, the purchase of additional shares does not confer any proportionate increase in voting rights, ownership interest, or control over the bank.

For context, the transaction details include:


Gufic Biosciences concluded that the clarification is necessary to ensure accurate understanding and to prevent any ambiguity regarding the characterization and nature of the share subscription.

GUFICBIO Stock Price Movement​

Gufic Biosciences Limited shares edged higher today, settling at ₹352.85 after gaining 1.77%. The stock saw significant activity, recording 172,252 shares exchanged throughout the session.