United Spirits extends losses after closure of Diageo's open offer

United Spirits fell 3.45% to Rs 2,414 at 14:40 IST on BSE, extending recent losses after Diageo plc's open offer for acquiring additional stake in United Spirits ended on 19 June 2014.

Meanwhile, the BSE Sensex was up 292.79 points, or 1.17%, to 25,392.71.

On BSE, so far 3.31 lakh shares were traded in the counter, compared with an average volume of 1.51 lakh shares in the past one quarter.

The stock hit a high of Rs 2,465 and a low of Rs 2,381.40 so far during the day. The stock hit a record high of Rs 2,940.55 on 15 April 2014. The stock hit a 52-week low of Rs 1,993.30 on 28 August 2013.

The stock had underperformed the market over the past one month till 27 June 2014, falling 10.85% compared with 2.24% rise in the Sensex. The scrip had also underperformed the market in past one quarter, falling 5.63% as against Sensex's 12.99% rise.

The large-cap company has an equity capital of Rs 145.33 crore. Face value per share is Rs 10.

Shares of United Spirits have been sliding after the voluntary unconditional open offer by Diageo plc for acquiring an additional 26% stake in United Spirits at Rs 3,030 per share ended on 19 June 2014. The offer had opened on 6 June 2014.

The stock fell 7.73% to Rs 2,589.30 on 19 June 2014. It has fallen 13.97% from Rs 2,806.10 on 18 June 2014.

Diageo had made the open offer with an intension to raise its stake in United Spirits to 54.78% from 28.78% (as on 31 March 2014).

This was Diageo's second attempt to gain majority control in India's number one alcoholic beverages firm. In 2012, Diageo had announced that it would pick up 53.4% stake in USL in a multi-structured deal.

As per an agreement reached between Diageo and the UB group in November 2012, Diageo agreed to acquire a 27.4% stake in United Spirits -- partly by acquiring shares directly from the promoter entities of the United Breweries group and partly by way of subscribing to a preferential share issue of United Spirits. The agreement triggered a mandatory open offer from Diageo to acquire additional 26% shares in United Spirits as per the Securities & Exchange Board of India's takeover norms.

Diageo's mandatory open offer to acquire an additional 26% in United Spirits at an offer price of Rs 1,440 per share closed on 26 April 2013. The company accepted bids for 58,668 shares as against proposed open offer size of 3.77 crore shares.

United Spirits is yet to announce its financial performance for Q4 and year ended 31 March 2014. United Spirits' net profit declined 19.4% to Rs 64.92 crore on 5.22% growth in total income to Rs 2351.49 crore in Q3 December 2013 over Q3 December 2012.

United Spirits is the largest alcohol beverage company in India, having sold 123.70 million cases in the year ended 31 March 2013.

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