Apollo Tyres gains after board approves acquisition of Reifencom GmbH

Apollo Tyres rose 2.39% to Rs 158.80 at 14:35 IST on BSE after the company's board of directors at its meeting held today, 16 November 2015, approved the acquisition of Reifencom GmbH, through its wholly owned subsidiary.

The company made announcement during market hours today, 16 November 2015.

Meanwhile, the S&P BSE Sensex was up 195.05 points or 0.76% at 25,805.58.

On BSE, so far 5.46 lakh shares were traded in the counter as against average daily volume of 2.58 lakh shares in the past one quarter.

The stock hit high of Rs 160.30 and low of Rs 151.10 so far during the day. The stock had hit a record high of Rs 249.45 on 3 February 2015. The stock had hit a 52-week low of Rs 154 on 9 November 2015.

The stock had underperformed the market over the past one month till 13 November 2015, declining 18.6% compared with 4.6% fall in the Sensex. The scrip had also underperformed the market in past one quarter, dropping 17.24% as against Sensex's 7.04% decline.

The mid-cap company has equity capital of Rs 50.90 crore. Face value per share is Re 1.

Apollo Tyres said that Reifencom GmbH will be acquired for a cash consideration of Euro 45.6 million. The acquisition requires regulatory and anti-trust approvals in Germany and Europe. The completion of acquisition may take 1-3 months. Reifencom GmbH was incorporated in 1989 and is in the business of tyres, rims & accessories, tyre fitment and alignment services. Reifencom GmbH clocked turnover of Euro 147 million in the financial year 2014. Apollo Tyres said that the acquisition of Reifencom GmbH is strategically aligned with the expansion strategy of the company.

Apollo Tyres' consolidated net profit rose 8.1% to Rs 278.74 crore on 10.5% decline in net sales to Rs 2979.99 crore in Q2 September 2015 over Q2 September 2014.

Apollo Tyres is in the business of manufacture and sale of tyres. The company offers a comprehensive product portfolio spread across passenger car, light truck, truck-bus, off highway and bicycle tyres, retreading material and retreaded tyres.

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