Polaris Financial Technology is throbbing with activity over the past couple of days. Yesterday, the stock had hit a new high, also breaching the upper circuit at Rs.183.35 and today too, the stock hit a new 52-week high at Rs.204.70. The stock currently remains strongly in the green, up 8%.

The stock is buzzing, reacting to the company to its Board on 18^th March giving an in-principal approval for the demerger of the products business into a separate listed entity.

After demerger and subject to approval from regulatory authorities and shareholders, the Product Company will be known as Intellect Design Arena Ltd (Intellect) and comprise of four distinct businesses : Global Universal Banking; Risk and Treasury Management; Global Transaction Banking and Insurance. Polaris Financial Technology Ltd (Polaris) will continue to run the Services Business with a strong vertical and solution focus.

As consideration for the Demerger (technically called a Vertical Split), every shareholder of Polaris Financial Technology Limited, will receive one share of Intellect. The Product business is significantly different from the Services stream, in terms of investments into product development, talent and sales & distribution. Given this, the Polaris Board, taking into consideration the recommendations made by the Special Committee comprising of independent directors of the Board as well as the Audit Committee, has decided to offer a special option to the shareholders of Intellect to exchange the shares (should they wish to) allotted pursuant to the Demerger against fully secured non-convertible debentures (NCD). These NCDs shall have a face value of Rs.42/- , with a coupon of 7.75% p.a., redeemable at par after 90 days