Sanstar Limited Board Approves ₹1,98 Crore Fundraise, Capital Increase, and Joint Venture Strategy

Sanstar Limited Board Approves ₹1,98 Crore Fundraise, Capital Increase, and Joint Venture Strategy​

Sanstar Limited announced several major corporate actions following its Board meeting held on May 28, 2026. The board approved a significant fundraising round through a preferential issue, alongside expanding the company’s capital structure and establishing a strategic joint venture focused on specialty ingredients.

The board also resolved to alter the company’s Memorandum of Association (MOA) to encompass a broader scope of manufacturing and trading activities and approved the convening of an Extraordinary General Meeting (EGM) on June 20, 2026, to seek shareholder approval for these proposed changes.

Capital Restructuring and Preferential Issue​

In a key move to strengthen its capital base, the board approved increasing the company’s authorized share capital. The authorized share capital was to be raised from the existing ₹38,00,00,000 (Rupees Thirty Eight Crore only) to ₹50,00,00,000 (Rupees Fifty Crore only). This expansion involves increasing the total equity shares from 19,00,00,000 (Nineteen Crore only) to 25,00,00,000 (Twenty Five Crore only) equity shares, each with a face value of ₹2 (Rupees Two only).

Simultaneously, the board approved raising funds of ₹1,98,26,57,270/- (Rupees One Hundred Ninety Eight Crore Twenty Six Lakh Fifty Seven Thousand Two Hundred and Seventy only) from Corn Products Development Inc. This capital infusion will take the form of a Preferential Issue of Equity Shares on a Private Placement Basis.

The investment details are summarized below:


The board also fixed the Relevant Date for the issue as May 21, 2026, and approved the use of the issue price of ₹110/- per share, which includes a premium of ₹108/- per share.

Strategic Joint Venture and Object Expansion​

The board approved executing a Shareholders' Agreement (SHA) for a joint venture (JV) involving Sanstar Limited, Spark Ingredients Private Limited, Ingredion India Private Limited, and Amishi Drugs and Chemicals Private Limited (a subsidiary of Ingredion India).

The joint venture, established in Spark Ingredients Private Limited, is intended to manufacture, sell, and distribute products spanning pharmaceuticals, ingredients, additives, and products for the food, nutraceutical, personal care, health, and wellness industries.

Under the proposed JV structure, Sanstar Limited will subscribe to 30% of the post-issuance paid-up share capital of the JV Company.

Separately, the board approved the alteration of the company's main object clause in the MOA. This amendment aims to expand and diversify the company’s business activities, enabling the company to deal with and trade in all kinds of plant-based products, agricultural products, and other commodities, including those used in food and pharmaceutical ingredients.

Governance and Minority Protection​

The board also approved the execution of a Share Subscription Agreement (SSA) and a Shareholders' Agreement (SHA) among Sanstar Limited, Corn Products Development Inc., and three other shareholders.

Key provisions approved include:

• Special Rights: Granting certain minority protection rights to the Proposed Allottee, which include the right to nominate one non-independent director, an affirmative voting right on specified matters, and pre-emptive rights. These rights are subject to the Proposed Allottee maintaining a minimum shareholding threshold.
• Governing Documents: Adopting the amended and restated Articles of Association and the Share Subscription Agreement, ensuring that the company's constitutional documents align with the new shareholder agreements.

Shareholder Approvals Required​

The board recommended the convening of the Extraordinary General Meeting on Saturday, June 20, 2026. This EGM is crucial to secure shareholder approval for the entire slate of proposals, including the capital increase, the preferential issue to Corn Products Development Inc., the grant of special rights, the alteration of the Articles of Association, and the change in the company’s Main Object clause.

SANSTAR Stock Price Movement​

On Wednesday, Sanstar Limited shares rallied by 7.38% to settle at ₹115.24. The equity experienced strong investor interest, trading throughout the day on a volume of 1.61 million shares.