Pipavav Defence rallies on heavy volumes

The open offer made by Reliance Infra together with its arm Reliance Defence was closed on Tuesday, December 15.

Pipavav Defence and Offshore Engineering Company have rallied 20% to Rs 78.15 on the National Stock Exchange (NSE) on back of heavy volumes after the open offer made by Reliance Infrastructure closed yesterday.

At 12:47 pm, the stock was up 18% to Rs 76.85 on the NSE. A combined 7.88 million shares representing 1.07% of total equity of Pipavav Defence have changed hands on the NSE and BSE. An average sub five million shares were traded in past two weeks on both the exchanges.

Reliance Infrastructure together with its wholly owned subsidiary Reliance Defence Systems had made Rs 1,263-crore open offer to acquire additional 26% stake in Pipavav Defence and Offshore Engineering Company. The offer commenced on December 2 and closed on December 15.

Under the offer, they would acquire up to 191.4 million shares from the public shareholders of Pipavav at a price of Rs 66 apiece.

In March, the Anil Ambani group firm had announced plans to acquire controlling stake in Pipavav Defence for up to Rs 2,082 crore.

As per the agreement with the promoters of Pipavav Defence, Reliance will acquire from them 130 million equity shares representing approx. 18% shareholding in the company at a price of Rs 63 per share, aggregating Rs 819 crore.