Distillery arm ceases to be a subsidiary after demerger; 1,84,00,034 shares allotted to eligible shareholders

Demerger update: with the Scheme of Arrangement for demerger of the Distillery Division becoming effective, KM Spirits and Allied Industries Limited has ceased to be a subsidiary from October 12, 2026.

Mon 12 Oct 2026

Shares allotted in resulting company

1,84,00,034 fully-paid up equity shares of INR 10/- each

Record Date

October 02, 2026

Shareholding change in resulting company

holding moved from 100% to Nil

What has happened

• The Scheme of Arrangement for demerger of the Distillery Division of K M Sugar Mills Limited into K M Spirits and Allied Industries Limited (the Resulting Company) has become effective.
• Consequently, KM Spirits and Allied Industries Limited has ceased to be a subsidiary of K M Sugar Mills Limited from October 12, 2026.
• The company's shareholding in the Resulting Company has moved from 100% before cessation to Nil / no controlling interest pursuant to the Scheme.

Share allotment in the Resulting Company

• Its board, in its meeting on October 12, 2026, approved allotment of 1,84,00,034 fully-paid up equity shares of INR 10/- each.
• These were allotted to eligible equity shareholders of K M Sugar Mills Limited whose names appeared in the Register of Members / records of depositories as on the Record Date, October 02, 2026, in accordance with the terms of the Scheme.
• The allotted shares rank pari passu in all respects with the existing equity shares of the Resulting Company.
• The existing equity shares of the Resulting Company held by K M Sugar Mills Limited stand cancelled, which is why the Resulting Company ceases to be a subsidiary.

Fractional entitlements

• The allotment also includes 7,319 fully paid up equity shares arising out of the fractional share entitlements of eligible shareholders of the Demerged Company.
• These have been allotted to Mr. Gurvinder Singh Monga, the Trustee appointed for the fractional entitlement, for disposal in the market and distribution of the net sales proceeds within a period of 90 days from the date of allotment.

What this means for shareholders

• Eligible shareholders of K M Sugar Mills Limited receive shares of the Resulting Company directly, so they hold a stake in the demerged distillery business.
• The newly allotted shares are not yet listed or approved for trading; the Resulting Company is in the process of making the necessary applications to the stock exchanges for listing and trading approval.
• Where an entitlement worked out to a fraction, the shares are pooled with the Trustee, sold in the market, and the net proceeds distributed within 90 days.

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