Orient Cement spurts after scrapping deal to acquire two Jaypee units

Orient Cement rose 12.47% to Rs 136.15 at 10:53 IST on BSE after the company said it has terminated the agreement to acquire two entities from Jaypee group firms.

The announcement was made before trading hours today, 31 May 2018.

Meanwhile, the S&P BSE Sensex was up 130.14 points, or 0.37% to 35,036.25.

On the BSE, 28,000 shares were traded in the counter so far compared with average daily volumes of 13,000 shares in the past one quarter. The stock had hit a high of Rs 139.50 and a low of Rs 122.90 so far during the day. The stock hit a 52-week high of Rs 183.80 on 5 January 2018. The stock hit a 52-week low of Rs 117.35 on 22 May 2018.

Orient Cement had entered into a share purchase agreement (SPA) with Jaiprakash Associates (JAL) for acquisition of 74% equity shares of Bhilai Jaypee Cement from JAL.

Further, the company entered into a business transfer agreement (BTA) with Jaiprakash Power Ventures (JPVL) and JAL for acquisition of Nigrie Cement Grinding unit, as going concern from JPVL. Each of the SPA and the BTA were executed on 31 May 2017.

Under provisions of the SPA and the BTA, either party is entitled to terminate the agreement if the closing does not take place within expiry of 12 months from date of execution of the SPA and the BTA. Since the closing has not been achieved within said period of 12 months the company has terminated the SPA and the BTA with notice to other parties. Therefore, the SPA and the BTA stand terminated.

Net profit of Orient Cement declined 22.46% to Rs 12.81 crore on 3.86% rise in net sales to Rs 619.74 crore in Q4 March 2018 over Q4 March 2017.

Orient Cement's product mix includes Ordinary Portland Cement (OPC) & Pozzolana Portland Cement (PPC) sold under the brand name of Birla A1.

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