Hathway Cable gains 3% as Reliance Industries launches Rs 442-crore OFS

Shares of Hathway Cable and Datacom advanced 3.4 per cent to Rs 22.4 apiece on the BSE on Monday as promoter group Reliance Industries launched an offer for sale (OFS) to pare stake in the DTH firm. At 10:53 am, the stock was quoting at Rs 22 per share on the BSE, up 2 per cent, as against a 1 per cent gain in the benchmark S&P BSE Sensex. A combined 3.2 million equity shares had changed hands on the counter on the BSE and NSE till the time of writing of this report.

The OFS is open for non-retail investors today while the same will open for retail investors on Tuesday, April 27.

As per the disclosure by Hathway, RIL intended to launch the OFS worth Rs 442-crore to offload 205.44 million shares, or an 11.61 per cent stake, at a floor price of Rs 21.50. Promoter group firms that will sell shares include Jio Content Distribution Holdings, Jio Internet Distribution Holdings, and Jio Cable and Broadband Holdings. According to the latest shareholding pattern, Promoters held 86.61 per cent and post this transaction, the holding will come down to 75 per cent.

"The share sale by these firms is aimed at achieving minimum public holding in Hathway in accordance with the norms set by the Securities and Exchange Board of India (Sebi)," it said in an exchange filing. Sebi rules prescribe that promoters cannot hold more than 75 per cent in a company. READ HERE

The OFS comes soon after RIL decided against going ahead with the merger of Hathway, Den Networks and TV18 Broadcast into Network18, a year after announcing the transaction. A delay in implementation was among the reasons for the cancellation of the merger.

RIL has been slowly bringing down its stake in Hathway, trimming its shareholding from 94.09 per cent in the quarter ended December 31, 2020 to 86.61 per cent in the three months ended March 31, 2021. Hathway was acquired in October 2018 by Reliance.

This is the second OFS by Reliance Industries in Hathway Datacom. Last month, Jio Content Distribution Holdings Pvt., Jio Internet Distribution Holdings Pvt. and Jio Cable and Broadband Holdings Pvt., promoter of Hathway Cable & Datacom Ltd sold 338 million shares, or a 19.1 per cent stake aggregating to Rs 853.45 crore.