Birla Ericsson jumps as promoters hike stake

Birla Ericsson Optical was locked at 5% upper circuit at Rs 41.65 at 14:27 IST on BSE after the company said its promoters have entered into an agreement with Ericssson Network Technologies, AB for acquisition of the latter's entire stake in the firm

The announcement was made after market hours yesterday, 12 July 2016.

Meanwhile, the S&P BSE Sensex was up 14.26 points or 0.05% at 27,822.40.

The stock surged on heavy volumes. On BSE, so far 1.42 lakh shares were traded in the counter as against average daily volume of 7,788 shares in the past one quarter. The stock hit a low of Rs 39.60 so far during the day. The stock had hit a 52-week high of Rs 74.50 on 16 July 2015. The stock had hit a 52-week low of Rs 29.35 on 28 March 2016. The stock had outperformed the market over the past one month till 12 July 2016, gaining 12.46% compared with the Sensex's 4.4% rise. The scrip had also outperformed the market in past one quarter, surging 11.83% as against Sensex's 10.59% rise.

The small-cap company has equity capital of Rs 30 crore. Face value per share is Rs 10.

Birla Ericsson Optical's promoters Universal Cables (UCL) and Vindhya Telelinks (VTL) have intimated the company that they have executed a share purchase agreement (SPA) with Ericssson Network Technologies, AB (Formerly known as Ericsson Cables AB) Sweden (ENT) for the acquisition of entire shareholding of ENT in the company i.e. 82.50 lakh fully paid up equity shares of Rs 10 each, comprising 27.5% of total shareholding of the company. With this acquisition, ENT shall cease to be a promoter/shareholder/technical collaborator of Birla Ericsson Optical.

UCL held 13% and VTL 13.33% stake in Birla Ericsson Optical (as per the shareholding pattern as on 31 March 2016).

Birla Ericsson Optical's net profit rose 17.2% to Rs 4.97 crore on 0.4% decline in net sales to Rs 74.76 crore in Q4 March 2016 over Q4 March 2015.

Birla Ericsson Optical is engaged in the design and production of fibre optic cables.

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