Apollo Tyres has rallied nearly 16% to Rs 117 also hits record high on the NSE, after Cooper Tire & Rubber Company (CTB) has terminated the merger agreement with the company.
CTB has stated that Apollo Tyres is not in a position to honor the agreement as the financing for the transaction is no longer available with Apollo Tyres.
Analyst at Angel Broking expects the ongoing litigation surrounding the deal to continue going ahead.
“Nevertheless, the termination of the deal is a positive development for Apollo Tyres given that the concerns regarding significant increase in leverage (to fund the acquisition) has been abated”, analyst said in a note.
However, clarity still needs to be sought on the break-up fee of US$112 million which was to be borne by Apollo Tyres for failure to conclude the deal, he added.
The stock opened at Rs 111 and hit a low of Rs 103 on the NSE. A combined around 13.3 million shares have changed hands on the counter so far on the BSE and NSE.
CTB has stated that Apollo Tyres is not in a position to honor the agreement as the financing for the transaction is no longer available with Apollo Tyres.
Analyst at Angel Broking expects the ongoing litigation surrounding the deal to continue going ahead.
“Nevertheless, the termination of the deal is a positive development for Apollo Tyres given that the concerns regarding significant increase in leverage (to fund the acquisition) has been abated”, analyst said in a note.
However, clarity still needs to be sought on the break-up fee of US$112 million which was to be borne by Apollo Tyres for failure to conclude the deal, he added.
The stock opened at Rs 111 and hit a low of Rs 103 on the NSE. A combined around 13.3 million shares have changed hands on the counter so far on the BSE and NSE.
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