Valecha Engineering surges after board's nod for sale of three road assets

Valecha Engineering was locked at 10% upper circuit at Rs 67.50 at 12:59 IST on BSE after the firm said its board approved sale of three road assets located in Madhya Pradesh and Gujarat for an aggregate consideration of about Rs 309 crore.

The announcement was made during market hours today, 29 September 2014.

Meanwhile, the S&P BSE Sensex was up 60.83 points or 0.23% at 26,687.15.

On BSE, so far 2,113 shares were traded in the counter as against average daily volume of 8,202 shares in the past two weeks.

The stock hit a low of Rs 66.10 so far during the day.

Valecha Engineering said that its board of directors at a meeting held on 27 September 2014, approved the sale of three build, operate and transfer basis road assets located in Madhya Pradesh and Gujarat to New Generation Infrastructure, Inc., a subsidiary of New Generation Holdings, Inc (purchaser) for an aggregate consideration for approximately Rs 309 crore. The purchaser's group is a global diversified infrastructure and energy developer with a diversified resource type in solar, hydro, wind, and thermal, Valecha Engineering said.

As a part of the proposed transaction, Valecha Infrastructure, a wholly owned subsidiary of the company has signed agreements with the purchaser and agreed to sell its shareholding in Valecha LM Toll and Valecha Badwani Sendhwa Tollways to the purchaser subject to receipt of regulatory and other third party approvals and consents including satisfaction of certain condition precedents by the parties. The company has also entered into a separate agreement with the purchaser and agreed to sell its shareholding in Valecha Infrastructure to the purchaser upon completion of the above transaction and receipt of regulatory and third party consents and approvals including satisfaction of certain condition precedents by the parties, Valecha Engineering said.

Valecha Engineering reported a net loss of Rs 0.43 crore in Q1 June 2014 as against net profit of Rs 3.47 crore in Q1 June 2013. Net sales declined 3.3% to Rs 149.19 crore in Q1 June 2014 over Q1 June 2013.

Valecha Engineering is engaged in the construction of major infrastructure & engineering projects such as roads, highways & expressways, bridges & tunnels, airports, irrigation dams, reservoirs & canals, railways foundation & piling works.

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