Merger ratio hopes boost Burroughs Wellcome

DALAL STREET SPIKES

The share price of Burroughs Wellcome (BWL), in a subdued market, soared over 12.9 per cent on the Bombay Stock Exchange (BSE) on Wednesday on expectation of a favourable merger ratio with GlaxoSmithKline Pharma. BWL and GSK Pharma have integrated their operations even as their legal merger has not taken place.

The merger ratio will be discussed at the board meeting to be held on March 17, 2004. While Burroughs Wellcome gained Rs 98 to close at Rs 856.95 before touching the day's high of Rs 874, GSK Pharma rose by 3.15 per cent to close at Rs 637.30, with more than 40,000 shares traded on the BSE alone.

Marketmen expect a merger ratio of 5:3 in favour of Burroughs Wellcome (5 shares of GSK Pharma for every three shares of BWL).