Amal tanks 20% as board approves merger with Atul

Shares in Amal is locked in lower circuit of 20% at Rs 31.35, falling 28% from intra-day high on BSE, after the boards of Amal and Atul approved a merger with a swap ratio of one shares of Atul for every 50 shares of the Amal.

“The board of directors of the company in the meeting held on December 05, 2014 based on the recommendation of the Audit Committee, approved the draft scheme of merger of Amal Ltd with Atul Ltd,” Amal said in a statement.

Valuation was carried out by Deloitte Haskins & Sells, Chartered Accountants and exchange ratio recommended by them is, one fully paid up equity share of face value Rs 10 each of Atul Ltd to be issued for every 50 fully paid up equity shares of face value Rs 10 each of Amal Ltd, it added.

Amal is an Associate company of Atul. Currently 80% of the products of Amal Ltd are being purchased by Atul Ltd. Thus the merger will give benefit of synergy between both the companies, it added.

The stock of Amal has opened at Rs 41.90 and touched a 52-week high of Rs 43.50 on BSE, before the merger swap ratio announcements. At 1410 hours, around 126,000 shares changed hands and there are pending sell orders for 54,240 shares on BSE.

Shares of Atul, on the other hand, were up 4% to Rs 1,304 after hitting a high of Rs 1,352 in early morning trade on BSE.