Magnum Ventures received observation letters from BSE Limited and National Stock Exchange of India Limited regarding its proposed scheme of arrangement with Magnum Paperz Limited. The exchanges issued their 'no adverse observation' on July 17, 2026, subject to the company complying with specific conditions and regulatory provisions. The scheme involves the demerger of Magnum Ventures Limited into Magnum Paperz Limited under Sections 230 to 232 of the Companies Act, 2013.

The stock exchanges, based on comments from SEBI, mandated several disclosures to be made to shareholders and the National Company Law Tribunal (NCLT). The company must disclose all details of ongoing adjudication, recovery proceedings, and enforcement actions against itself, its promoters, and directors. Additionally, the entity is required to clearly disclose details of non-compliance with the Takeover Regulations and pending Settlement Applications filed with SEBI.

Financial and Operational Disclosures

The exchanges directed the company to include specific financial and operational data in the explanatory statement sent to shareholders. This includes the rationale for the demerger, synergies, and a cost-benefit analysis. A detailed financial table covering the last three years for both entities must be provided, though the specific figures were not disclosed in the filing.

Conditions for Listing

The listing of equity shares of Magnum Paperz Limited remains subject to SEBI granting relaxation under Rule 19(2)(b) of the Securities Contract (Regulation) Rules, 1957. The company must submit an Information Memorandum containing all details of Magnum Paperz Limited to the exchanges and publish an advertisement in newspapers referencing this memorandum. The shares allotted pursuant to the scheme will remain frozen in the depository system until listing or trading permission is granted by the designated stock exchange.

Procedural Requirements

The validity of the observation letters is six months from July 17, 2026, within which the scheme must be submitted to the NCLT. The company must disclose the No-Objection letters from the stock exchanges on its website within 24 hours of receipt. The exchanges reserved the right to withdraw their 'no adverse observation' if any information submitted is found to be incomplete, incorrect, or misleading.

Magnum Ventures Limited has allotted 5,000 listed, secured, redeemable, non-convertible debentures (NCDs) aggregating ₹50 crore on a private placement basis. The allotment, finalized on June 16, 2026, carries a coupon rate of 18% per annum payable monthly. The funds raised will address the working capital requirements of the company. The NCDs have a tenure of 4 years, 9 months, and 15 days, maturing on March 31, 2031, and are proposed to be listed on the National Stock Exchange of India Limited (NSE) and BSE Limited.

Neo Special Credit Opportunities Fund, managed by Neo Asset Management Pvt Ltd, subscribed to the issuance. The security structure includes a pari passu charge over fixed and intangible assets of the Paper Division, along with current assets of the same division. Additionally, the company must maintain a one-month debt service reserve in the form of a fixed deposit. The security package is cross-collateralized with existing NCDs issued by the company.

Security and Guarantee Details

The comprehensive security package involves personal guarantees from Mr. Pradeep Kumar Jain, Mr. Abhay Jain, and Mr. Parv Jain. Furthermore, Mr. Parv Jain has pledged 83,24,255 equity shares to secure the debt. In the event of a default, the company is liable to pay default interest at 1% per month.

The redemption of the debentures is scheduled in 13 installments starting from March 31, 2027, and concluding on March 31, 2031. The disclosure was made to the stock exchanges in compliance with Regulation 30 and 51 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Redemption Schedule