Tribunal Sanctions Scheme for Siyaram Silk Mills; Equity Shareholders to Receive Preference Bonus

Tribunal Sanctions Scheme for Siyaram Silk Mills; Equity Shareholders to Receive Preference Bonus​

Siyaram Silk Mills Limited has received sanction from the National Company Law Tribunal, Mumbai Bench, regarding its Scheme of Arrangement with shareholders. The order was passed on July 21, 2026, approving the scheme which involves the issuance of Preference Shares by way of bonus to the company's equity holders.

The Scheme utilizes the general reserves of Siyaram Silk Mills Limited and includes various other consequential matters. The company is engaged in the business of manufacturing, branding, and marketing fabrics, readymade garments, and indigo dyed yarn.

Details of Preference Share Issuance​

The proposed scheme dictates that preference shares will be issued by way of bonus to equity shareholders, leveraging the surplus reserves built up over the years. The issuance structure includes two series of fully paid up preference shares:

Rationale Behind the Scheme​

The company stated that the rationale for undertaking this scheme was to optimally utilize its substantial surplus reserves and reward its shareholders. Management noted that even after issuing preference shares, the company would maintain sufficient cash resources to meet all obligations toward lenders and other stakeholders in the ordinary course of business.

The decision to issue preference shares by bonus was made with the aim of distributing a significant portion of the surplus funds among equity shareholders. The newly issued Preference Shares are set to be a listed security, providing flexibility for both the company and its equity shareholders in managing liquidity until redemption.

Stakeholder Approval and Compliance​

The scheme, which provides for the issue of preference shares by way of bonus, was approved by the Board of Directors on October 26, 2024. Subsequently, meetings were held for the Equity Shareholders and Unsecured Creditors of Siyaram Silk Mills Limited on December 29, 2025. The Chairperson appointed for these meetings reported that requisite quorum was present, and both groups approved the scheme with the necessary majority.

The company confirmed compliance with all requirements set by the Tribunal and undertook to fulfill any statutory obligations under the Companies Act, 2013.

The Scheme of Arrangement received observations from regulatory bodies including BSE Limited and the National Stock Exchange of India Limited (NSE) through letters dated July 7, 2025, and July 11, 2025. The company confirmed that these observation letters were filed with the Tribunal along with the necessary applications.

SIYSIL Stock Price Movement​

Siyaram Silk Mills Limited shares slipped on Wednesday, shedding 1.24% as the stock settled at ₹627.85. The equity traded a volume of 35,183 shares during the session.