Uttam Galva hits upper circuit on open offer

The stock price of Uttam Galva Steels today hit the upper circuit on the stock exchange after ArcelorMittal, the largest steel maker in the world, said it would make an open offer to buy an additional 29.4 per cent stake in the company from the public at Rs 120 a share.

The open offer would begin on October 31 and close on November 19. SBI Capital Markets made the open offer announcement on behalf of ArcelorMittal, Netherlands, today.

On Friday, ArcelorMittal announced that it had, on September 3, entered into a share-purchase agreement with Uttam Galva’s existing promoters, the RK Miglani family, for acquiring their 5.6 per cent stake.

Upon successful conclusion of the offer, ArcelorMittal will hold 35 per cent stake in the Indian cold-rolled and galvanised products maker. The LN Mittal-controlled company will spend Rs 422.71 crore for the share purchase from the public and existing promoters.

The share price of Uttam Galva shot up 10 per cent on the Bombay Stock Exchange and closed at Rs 125.05, beating its life-time high of Rs 113.70 recorded on Friday.

Sainath Trading Company, one of the promoters of Uttam Galva, has sold 1.2 million shares in a bulk transaction on BSE, while an individual promoter from the Miglani family (which controls Uttam Galva) bought 0.6 million shares. No public shareholder sold any shares on Monday, when demand was high at the seller’s counter.